UPDATE BREAKING: Layoffs and executive shuffles at Tesla Motors
by Sam Abuelsamid on Oct 15th 2008 at 4:49PM 
Click above for high-res gallery of the Tesla Roadster
Tesla is now on its fourth CEO in just 12 months as the fledgling all-electric automaker has announced today that chief fund-raiser, architect and Chairman Elon Musk will take up the mantle from current CEO Ze'ev Drori. Early this morning Valleywag reported that Tesla would be firing up to 100 of its staff and that Drori might be leaving. A call to Tesla SVP Darryl Siry revealed that the story was not entirely accurate. Drori is not leaving the company, but will move over to become Vice Chairman. Exactly what that means is not entirely known at this point, although clearly Musk intends to take a more hands on role now that his Space-X rocket finally managed to get into orbit. Tesla is also laying off some staff, although the extent of lay offs is unknown at this time. Siry promised an official announcement sometime this morning, but we're still waiting.
UPDATE: Tesla has finally published a blog post on the company site (sorta) detailing what's going on. In short, the activity on Wall Street that's decimated your 401k over the past week is part of the problem. Musk has decided to take the reigns as the company consolidates its efforts on shipping Roadsters and selling powertrain technology to other companies. Both of those will generate revenue. Almost everything else is essentially on hold for now. That means that Model S development is being scaled back temporarily and the Auburn Hills, MI engineering office is being shuttered. In the future all work will happen out of the new San Jose CA HQ. The slowdown will be in effect until Tesla is able to tap into low cost DOE loans that will help pay for development of the Model S and construction of the factory. Production of the sedan is now pushed back at least six months to mid-2011. Musk acknowledged a head count reduction, (aka lay offs) but didn't reveal how extensive that would be.
Gallery: First Drive: Tesla Roadster
[Source: Tesla Motors]
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Reader Comments (Page 1 of 3)
Mehdi Cheddadi 12:39PM (10/15/2008)
I don't care about Tesla or it's car anymore until I actually see one in the streets...
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Tony2X 1:37PM (10/15/2008)
There is one parked in my company parking lot right now and I've seen two now on US-101, so they are making cars and they have got into the hands of their customer.
I do live in San Francisco which is just down the road from their HQ so the prototypes have been a common sight for a while now, but these are production vehicles I've seen out and about.
dsharp23 6:22PM (10/15/2008)
Saw one last week in santa monica. they are real.
Dustin 12:44PM (10/15/2008)
Have they made ten cars yet?
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why not the LS2LS7? 4:13PM (10/15/2008)
Yes. I believe they've made over 30.
Schmeltz 12:47PM (10/15/2008)
Not more drama for this Company! What is going on there? Not knowing the full story, my knee-jerk reaction to this is someone there is very difficult to get along with. Lets hope the quality of the cars and the upcoming models doesn't suffer as a result of this!
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Mark 1:41PM (10/15/2008)
how do you layoff before putting out a product?
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ckm 12:57PM (10/15/2008)
Musk is not the architect of Tesla, he's just very good at taking credit for other people's work, that's pretty much his modus operandi. Martin Eberhard was the architect of Tesla.
http://en.wikipedia.org/wiki/Martin_Eberhard
I'm not surprised Tesla has all these problems. I predict they wind up sold to a major car company in the next 4 months.
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Rainy99 1:08PM (10/15/2008)
I would like to know why they are laying of folks too. Is someone buying them? Did their orders fall off?
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Jason 1:10PM (10/15/2008)
You'd think a company selling electric cars would be raking in the cash right about now.
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Scott Eaton 1:35PM (10/15/2008)
They would be raking in the cash if they could A) produce them fast enough in "finished" form, and B) produce a simply practical car that would be a great commuter.
They aren't. I see one occasionally - which is odd since I'm in a Lotus Elise... and I have to wonder why I would pay $65,000 more for the same car with an electric drivetrain. My car was $46,000, which is LESS than the *difference* between a gas Elise and an electric Elise called the Tesla.
Peter 1:41PM (10/15/2008)
Why pay the premium for the Tesla? It's faster, it runs on local energy, and (charged on renewables) it's a completely zero emissions vehicle.
If I had the money for either I'd choose the Tesla in a heartbeat.
dukeisduke 1:52PM (10/15/2008)
Outside of Hollyweird types, who's gonna spend over $100k for a two-seat electric car?
EchelonBob 2:50AM (10/22/2008)
It also looks a hell of a lot better than the bugeye Elise...
Kotse 1:33PM (10/15/2008)
"..although clearly Musk intends to take a more hands on role now that his Space-X rocket finally managed to get into orbit."
I'd bet the SpaceX propulsion is all electric as well...funded/paid via Paypal. ;)
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dukeisduke 1:50PM (10/15/2008)
Time to crank out another conspiracy theory movie - "Who Killed The Electric Car? II".
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why not the LS2LS7? 4:14PM (10/15/2008)
It's been in production for some time.
simianspeedster 1:51PM (10/15/2008)
I've been saying it all along and I'll say it again: Tesla Motors is doomed to failure (or buyout for pennies on he pound). Tesla Motors is the automotive equivalent of a dot-com to dot-bomb failure.
Don't misunderstand me: I think the Tesla Roadster is a promising experiment, but the company cannot get out from under the crush of hubris, ego and mismanagement.
Any sane company trying to break into the very established and very capital-intensive automotive landscape would have tried to partner with an existing company or at least emulate the successful elements of current automotive companies. Tesla tries to be different in every way. They want to re-invent the car, the sales and distribution model, the service model -- everything. They have bitten off far more than any company their size could chew.
Had Tesla merely developed a car that they could somehow sell with or through an established player, they could be off and running right now. Certainly, they might have had to face compromises and choices to get there, but that's how most businesses evolve.
Tesla Motors is just like eToys -- instead of focusing completely on the savings that come from retailing by internet, they built expensive shrines to themselves and tried to re-invent the product distribution model. Tesla is doing the same thing by not focusing all their energies on the car itself. You have to pick your battles. In this case, it should be all about product.
Mark my words: we will NEVER see the $65K White Star sedan from Tesla Motors in their current form, especially now that the economy is tanking. They'll probably end up selling the IP to some othe company.
-SimianSpeedster
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Kaptain75329 10:53AM (10/18/2008)
This is the most intelligent comment I've ever read about Tesla, period.
Diffrunt 1:56PM (10/15/2008)
Egos greed teething inexperience of the new frontier
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