NBC Bay Area
Tesla officials Friday handed over the keys to the first lucky owners of its Model S, an all-electric sedan. NBC Bay Area's Jodi Hernandez reports.
About 1,000 people, including Gov. Jerry Brown, gathered at the Tesla Motors auto plant in Fremont Friday for a festive event marking the delivery of the company's first Model S electric cars to customers.
The company, which has lost money every year since it was founded in 2003, says the Model S is the world's first premium electric sedan.
The event had the atmosphere of a pep rally or a revival meeting, with Tesla executives telling the crowd, which mostly consisted of Tesla employees, that the delivery of the sedans proves that the naysayers who doubted the company's future were wrong.
George Blankenship, Tesla's vice president for sales, said, "A lot of people said this day would never come, but we don't think about them."
Focusing his remarks on the Tesla employees who gathered at the plant as well as other employees who watched the event at the company's headquarters in Palo Alto, Blankenship said, "We have a message of three
words: we did it!"
Elon Musk, Tesla's chief executive and co-founder, said the introduction of the Model S will change the way cars are made.
"What this is really all about is breaking the illusion that electric cars are not as good as gas cars," Musk said.
He said, "We are showing that an electric car can in fact be the best car in the world."
Musk said, "Our customers will discover that this is the best car in every dimension, including performance, safety, technology, handling and styling."
Brown said the Model S "is another example of California being on the move and on the cutting edge of technology."
Brown said the rollout of the Model S is due to "a lot of risk-takers and help from the government."
Brown was referring to the $465 million U.S. Department of Energy loan Tesla received to spur the development of green technology. In addition, people who buy Model S cars will get a $7,500 federal tax credit.
The Model S carries a starting price of $49,900 after the tax credit and models range in price up to $101,500.
Although it isn't cheap, the Model S will be less than half the price of Tesla's first car, the Roadster, which had a starting price of $109,000.
Tesla only sold about 2,150 Roadster cars over four years and stopped making them last year.
Tesla says it is beginning deliveries of the Model S a month earlier than originally planned and it is in a good position to build 5,000 cars by the end of this year followed by 20,000 cars next year.
Tesla is making the Model S at the former New United Motors Manufacturing Inc. facility in Fremont, which has a long history as an auto plant.
General Motors opened the plant in 1960 but ceased operations there in 1982.
The plant reopened in 1984 as a joint venture between GM and Toyota Motor Corp., which was called New United Motors Manufacturing Inc., or NUMMI.
But GM withdrew from the partnership in 2009 and Toyota decided to close the plant on April 1, 2010, throwing 4,700 union employees out of work and affecting thousands of employees at suppliers around the state who relied on the auto plant for business.
On May 20, 2010, Tesla announced that it would buy the NUMMI factory for $42 million.
Toyota helped spur the deal by pledging to buy $50 million worth of Tesla's common stock and the deal was finalized Oct. 19, 2010.
Tesla initially used only part of the auto plant for the Model S and only employed several hundred people but Musk said that, "We have about 2,000 people now and we hope to exceed the employment level" that NUMMI
used to have.
"We're proud to have hired many former NUMMI workers to help us make the best cars in the world," Musk said.