SAN CARLOS, CA --- Tesla Motors has received approval for about $465 million in low-interest loans from the U.S. Department of Energy to accelerate the production of affordable, fuel-efficient electric vehicles.
Tesla said it will use $365 million for production engineering and assembly of the Model S, an all-electric family sedan that carries seven people and travels up to 300 miles per charge.
The Model S has an anticipated base price of $49,900 after a $7,500 U.S. federal tax credit. It has lifetime ownership costs equivalent to a conventional car with a sticker price of $35,000. Tesla expects to start Model S production in late 2011 in an assembly plant employing about 1,000 workers.
Tesla will use $100 million for a powertrain manufacturing plant. The facility will supply all-electric powertrain solutions to other automakers, accelerating the availability of mass-market EVs. The new facility is expected to employ about 650 people.
Tesla said it is in the final stages of negotiation for facilities in California.
The loans are part of the Advanced Technology Vehicle Manufacturing Program, which provides incentives to new and established automakers to build more fuel-efficient vehicles. Created in 2007 and appropriated in September 2008, the $25 billion ATVM aims to reduce America's dependence on foreign oil and create "green collar" jobs. The program is entirely unrelated to the stimulus package or the so-called "bailout" funds that General Motors and Chrysler have received.
"Tesla will use the ATVM loan precisely the way that Congress intended -- as the capital needed to build sustainable transport," said Tesla CEO and Product Architect Elon Musk.