• Jun 22, 2009
Shortly after Tesla Motors co-founder Martin Eberhard filed a lawsuit against Tesla Motors and its Chairman, Product Architect and CEO Elon Musk, the Silicon Valley automaker had this to say:
This lawsuit is a fictionalized, inaccurate account of Tesla's early years -- it's twisted and wrong, and we welcome the opportunity to set the record straight. Incidentally, Tesla will also be filing counterclaims and in the process present an accurate account of the company's history.
The first bit of record-resetting has shown up on the official Tesla blog. Not surprisingly, Elon Musk has lots to say in regards to the early years of the Roadster's development, and he seeks to offer his side of the story, along with a number of emails to back up his claims.

What does Musk say? Well, his initial response is a long, informative and interesting read. Here are some choice lines:
  • The facts are that when I requested through AC Propulsion to meet Eberhard, he had no technology of his own, he did not have a prototype car and he owned no intellectual property relating to electric cars.
  • At the time [early 2004], "Tesla Motors, Inc." consisted of Eberhard, Tarpenning and Wright, plus an unfunded business plan and they were looking for an initial round of funding to create a more advanced prototype than the AC Propulsion Tzero. While there was a basic corporation in place, Tesla hadn't even registered or obtained the trademark to its name and had no formal offices or assets.

Make the jump for more.


[Source: Elon Musk / Tesla Motors]

From Elon Musk:
  • To save legal fees, we just copied the SpaceX articles of incorporation and bylaws for Tesla and I invested $6.35M (98). In another crossover, I had the same people who created the SpaceX logo also create the Tesla logo.
  • For the first few years of Tesla's existence, I trusted Eberhard to execute on the operational task of taking the Tzero concept and creating a commercial electric sports car. My involvement was primarily focused on the body design, technical specifications and building the Tesla brand.
  • Eberhard has simultaneously implied that I had nothing to do with the creation of the Roadster and that I micromanaged the design and thus caused the cost overruns. Obviously, those claims are mutually exclusive.
  • The real reason that Roadster development cost so much more than can be accounted for by typical entrepreneurial hubris is that we essentially had to spend the development money twice. After Eberhard was asked to step down from the CEO role two years ago, almost every major system on the car, including the body, HVAC, motor, power electronics, transmission and battery pack, had to be redesigned, retooled or switched to a new supplier. With the release of the Roadster 2 this month, we are finally at the point where Tesla has a solid supply chain and a unit cost that allows us to operate the Roadster business line profitably.
  • This point is so trivial that I'm nearly inclined to skip it. However, in the absence of an explanation, it may sound as though I was being petty in giving Eberhard the third production car rather than the second production car. The reason for the delayed delivery was that there was considerable debate at the board level as to whether Eberhard should receive a car at all or whether he should be refunded his money.
This surely won't be the last we hear from either side of the lawsuit. Anyone with an interest in keeping tabs on the company, its founders and its future should click here to read Elon's blog entry in its entirety.



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    • 1 Second Ago
  • 11 Comments
      • 5 Years Ago
      Douchebag strikes again. Initially, it's not about the money, assets etc that Musk claims. It's the core people with an idea. Sure, on paper according to him Eberhard didnt have legal claims over novel apparatus. Neither did the founders of Microsoft.

      The guy is a corporate barracuda and honestly a jerk. I would not buy a car from his firm. He's the type who would suddenly change terms on you when he deems fit, not one for customer loyalty or care. I wouldnt be surprised if the firms philosophy reflected his leadership.

      Btw, Tesla is NOT a car manufacturer. They work on Lotus chassis and bodies, foreign batteries. The only thing they do is install the battery, do the programming and I think make the tranny. When they make more components in house/chassis, then they can claim that.
        • 5 Years Ago
        I suggest you double check that timeline, Snowdog.
        • 5 Years Ago
        Snowdog hold on. Dont you think you're oversimplifying the whole thing: Martin was just a man who wanted to build an electric car. Jeez. Musk is an expert at marginalization.
        I hope you're not buying into Elon-Tesla propaganda here. I'm not saying they didnt make some components or didnt 'go to market' the product. What I am saying is the firm has a high noise to substance ratio and has more rah rah and bark than actually bite. It's shipped 500 cars, questionable trans, screwed users, doesnt have a reliability history, a jerk for a manager and finally is built on Lotus engineering and design. Fisker has a much more appealing approach and philosophy.
        • 5 Years Ago
        Tankdog. Where is this timeline and what would it show that is different?
        • 5 Years Ago
        Read the blog. It sounds like Martin wanted to build an electric car, but had no particular knowledge, had no money, no offices, nothing.

        I am sure you could find a lot of people who wanted to build an electric car with no real knowledge and no money.

        If he didn't happen to get together with Elon, there likely never would have been a Tesla.

        Tesla is using Lotus for the chassis manufacture, but it is not an Elise, it is extensively redesigned, they also designed their own electric motor, the software that runs it, and the battery system, AND they brought it to market.
        • 5 Years Ago
        Hahaha, the transmission on those things is a total piece of junk. From outright broken ones, to the infamous "beta" shipment, to ones that crap out after a lame number of miles, they are garbage. Yet they are the most "tesla" of anything on there. Kind of says something, does it not?

        Musk is a complete and utter jerk. It looks like people are starting to see that. I just hope that he does not take down the whole concept of the electric car when he falls.
      • 5 Years Ago
      Tesla's great achievement is taking a Lotus Elise and ruining it by putting bad tires on it and adding 400 pounds of batteries which inconveniently make the car handle worse and make driving from Washington to San Francisco take two days instead of 12 hours and cost a lot more (if you compare the cost of renting a room for two nights to the cost of filling the tank on an Elise a couple times.)

      Can we stop having news on them?
      • 5 Years Ago
      The drama continues.
      • 5 Years Ago
      awe, the tZero. I miss that car.
      • 5 Years Ago
      He has a serious case of douche face.
      • 5 Years Ago
      Nothing like a couple rich boys having a lawyer fight. Try not to hurt your manicures in the process.