This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
Stocks Under $10 with 50-100% upside potential - 14 days FREE!

How Tesla Plans to Revolutionize the Electric Car

Ciaccia: Do you think that battery costs can come down markedly over the next five years?

Ahuja: I think that in past experience, typically, it averages to about 8% annually. It doesn't necessarily happen every year - there are step functions. The cumulative annual effect is 8%. The product development cycle that we see at these cell manufacturers are these cost reductions will continue in the future at roughly the same rate.

Ciaccia: You touched on power trains before. Tesla does a lot of other work for Toyota and Daimler Benz. What kind of relationships do you have with the two of them, and do you foresee any kind of expansion with other manufacturers to make electric vehicles more than just a niche market?

Ahuja: Our relationship with both Toyota and Daimler, I would say, has been extremely constructive and growing. Clearly they have taken a bigger picture approach as well, since they have decided to invest in Tesla in addition to being our commercial partners. The two are fairly diligent in dealing with commercial decisions in an ongoing basis.

We see a growing opportunity at both Toyota and Daimler, and clearly we've continued to announce the progression of those partnerships, with Daimler, including the recent program where they announced [the] Mercedes Benz vehicle. We'll provide the entire electric power train, not just the battery pack as we have in the past.

For Toyota, we already are providing the entire electric power train, and I think that's going to be an amazing product in the market. Those relationships, I would say have been mutually beneficial. Not only have we provided the power trains, we've learned a lot from them. It's also helped our own supply chain, getting access to cheap parts, and parts that are being purchased at high volumes by Toyota and Daimler, so we get the economies of scale from them. Beyond Toyota and Daimler, we certainly are in conversations with folks. It's a balance between our requirements and our resources required on our vehicles. As it becomes appropriate to announce something, we will.

Ciaccia: How important are the international markets to Tesla? China is consuming an astronomical amount of natural resources. Does Tesla have any plans to educate those consumers on the benefits of having an electric vehicle versus having an internal combustion engine? In terms of a revenue percentage, how do Tesla's revenues break down, domestic, versus international?

Ahuja: We've always considered the international markets important. Roughly half of our stores are located internationally, in Europe and Asia. The Roadsters we've sold in 30 countries, as you may have read. The Roadster has really helped us learn how to be an international company and create a presence in these countries. It serves as a terrific foundation for us as we launch the Model S internationally. The international markets are therefore important in our minds for Model S. We expect to get into Europe and Asia next year with the Model S.

China, as you said, is a huge market. There's also significant price premiums in China, because customers are willing to pay for premium products. We are exploring China, and we definitely expect to be there sometime, I would say, in the 2013 time-frame. I would say the process of getting into China is longer, given the local governments. It's hard to predict exactly when we'll be in China.

Interested in more on Tesla Motors? See TheStreet Ratings' report card for this stock.

Check out our new tech blog, Tech Trends. Follow TheStreet Tech on your wireless devices.

--Written by Chris Ciaccia in New York

>Contact by Email.

3 of 3

Select the service that is right for you!

COMPARE ALL SERVICES
Action Alerts PLUS
Try it NOW

Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
  • Weekly roundups
TheStreet Quant Ratings
Try it NOW
Only $49.95/yr

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
  • Upgrade/downgrade alerts
Stocks Under $10
Try it NOW

David Peltier, uncovers low dollar stocks with extraordinary upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
  • Weekly roundups
Dividend Stock Advisor
Try it NOW

Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Alerts when market news affect the portfolio
  • Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
Real Money Pro
Try it NOW

All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.

Product Features:
  • Real Money + Doug Kass Plus 15 more Wall Street Pros
  • Intraday commentary & news
  • Ultra-actionable trading ideas
Options Profits
Try it NOW

Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • 100+ monthly options trading ideas
  • Actionable options commentary & news
  • Real-time trading community
  • Options TV
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!
DOW 16,979.13 +59.54 0.35%
S&P 500 1,986.51 +4.91 0.25%
NASDAQ 4,526.4820 -1.0320 -0.02%

Brokerage Partners

Rates from Bankrate.com

  • Mortgage
  • Credit Cards
  • Auto

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs