Tesla, Inc. (formerly Tesla Motors, Inc.) is an American electric vehicle and clean energy company based in Palo Alto, California. Tesla's current products include electric cars, battery energy storage from home to grid scale, solar panels and solar roof tiles, as well as other related products and services.
Founded in July 2003 as Tesla Motors, the company's name is a tribute to inventor and electrical engineer Nikola Tesla. Elon Musk, who contributed most of the funding in the early days, has served as CEO since 2008. According to Musk, the purpose of Tesla is to help expedite the move to sustainable transport and energy, obtained through electric vehicles and solar power.
Tesla ranked as the world's best-selling plug-in and battery electric passenger car manufacturer in 2019, with a market share of 17% of the plug-in segment and 23% of the battery electric segment. Tesla global vehicle sales were 499,550 units in 2020, a 35.8% increase over the previous year. In 2020, the company surpassed the 1 million mark of electric cars produced. The Model 3 ranks as the world's all-time best-selling plug-in electric car, with more than 500,000 delivered. Through its subsidiary SolarCity, Tesla develops and is a major installer of solar photovoltaic systems in the United States. Tesla is also one of the largest global suppliers of battery energy storage systems, from home-scale to grid-scale. Tesla installed some of the largest battery storage plants in the world and supplied 1.65 GWh of battery storage in 2019.
Tesla has been the subject of numerous lawsuits and controversies, arising from the statements and the conduct of CEO Elon Musk, allegations of whistleblower retaliation, alleged worker rights violations, and allegedly unresolved and dangerous technical problems with their products.
Founded as Tesla Motors, Tesla was incorporated on July 1, 2003, by Martin Eberhard and Marc Tarpenning. The two founders were influenced to start the company after GM recalled all its EV1 electric cars in 2003 and then destroyed them, and seeing the higher efficiency of battery-electric cars as an opportunity to break the usual correlation between high performance and low mileage. The AC Propulsion tzero also inspired the company's first vehicle, the Roadster. Eberhard said he wanted to build "a car manufacturer that is also a technology company", with its core technologies as "the battery, the computer software, and the proprietary motor".
Ian Wright was Tesla's third employee, joining a few months later. The three raised US$7.5 million in Series A funding in February 2004, with Elon Musk contributing $6.5 million. Musk became chairman of the board of directors, and appointed Eberhard as CEO. J. B. Straubel joined Tesla in May 2004. A lawsuit settlement agreed to by Eberhard and Tesla in September 2009 allows all five (Eberhard, Tarpenning, Wright, Musk and Straubel) to call themselves co-founders.
Main article: Tesla Roadster (first generation) Musk took an active role within the company and oversaw Roadster product design at a detailed level, but was not deeply involved in day-to-day business operations. From the beginning, Musk consistently maintained that Tesla's long-term strategic goal was to create affordable mass market electric vehicles. Tesla's goal was to start with a premium sports car aimed at early adopters and then moving into more mainstream vehicles, including sedans and affordable compacts.
In February 2006, Musk led Tesla's Series B $13 million investment round which added Valor Equity Partners to the funding team. Musk co-led the third, $40 million round in May 2006 along with Technology Partners. This round included investment from prominent entrepreneurs including Google co-founders Sergey Brin & Larry Page, former eBay President Jeff Skoll, Hyatt heir Nick Pritzker and added the VC firms Draper Fisher Jurvetson, Capricorn Management, and The Bay Area Equity Fund managed by JPMorgan Chase. Musk led the fourth round in May 2008 which added another $40,167,530 in debt financing, and brought the total investments to over $100 million through private financing.
List of chief executive officers of Tesla 1 Martin Eberhard (2004–2007)
2 Ze'ev Drori (2007–2008)
3 Elon Musk (2008–present) Prototypes of the Tesla's first car, the Roadster, were officially revealed to the public on July 19, 2006, in Santa Monica, California, at a 350-person invitation-only event held in Barker Hangar at Santa Monica Airport. Tesla began production of the Roadster in 2008.
2010–2015: IPO, Model S and Model X
In January 2010 Tesla received a $465 million loan from the U.S. Department of Energy, which it repaid in 2013.
In May 2010, Tesla purchased what would become the Tesla Factory in Fremont, California, for $42 million, and opened the facility in October 2010 where Model S would be produced.
On June 29, 2010, Tesla Motors launched its initial public offering (IPO) on NASDAQ, the first American car company to do so since the Ford Motor Company had its IPO in 1956.
First deliveries of Model S at the Tesla Factory in Fremont, California In June 2012, Tesla launched its second car, the Model S luxury sedan, and its first SUV, the Model X, in September 2015.
In April 2015, the company unveiled its Powerwall home and Powerpack industrial battery packs, and received orders valued at $800 million within a week of the unveiling.
2016–present: SolarCity, Model 3, and Model Y
In November 2016, Tesla acquired SolarCity. Few months later, in February 2017, Tesla Motors shortened its name to Tesla, Inc., to better reflect the scope of the expanded business. Tesla began selling the Model 3 sedan in July the same year.
Tesla also started its philanthropic effort. Tesla made multiple contributions of solar power to areas recovering from disasters in 2017. In July 2018, the company donated $37.5 million to K-12 STEM education in Nevada. In January 2020, Tesla donated 5 million Yuan ($723,000) to the Chinese CDC to fight the COVID-19 outbreak.
In 2018, CEO Elon Musk briefly considered taking Tesla private. In March 2020, Tesla began deliveries of the Model Y crossover.
On January 10, 2020, Tesla become the most valuable American automaker ever, with a market capitalization of $86 billion. On June 10, 2020, Tesla's market capitalization surpassed those of BMW, Daimler and Volkswagen combined.The next month, Tesla reached a market capitalization of $206 billion, surpassing Toyota's $202 billion to become the world's most valuable automaker by market capitalization. On August 31, 2020, Tesla had a 5-for-1 stock split following the increase in value.
From July 2019 to June 2020, Tesla reported four profitable quarters in a row for the first time, which made it eligible for inclusion in the S&P 500. Tesla was added to the index on December 21 of the same year. Tesla was the largest company ever added, and the sixth-largest company in the index at the time of inclusion. As investors tried to buy more shares as a result of this inclusion, some analysts, such as J.P. Morgan's Ryan Brinkman, suggested investors exercise caution as Tesla was "dramatically" overvalued. In 2020, the share price of Tesla increased 740%, and as of December 2020, its market capitalization was more than the next nine largest automakers combined.
It was announced in January 2021 that the company had hit its goal of building a half-million cars in 2020.