By John D. Stoll
Tesla Motors Inc. on Wednesday indicated the company has yet to
complete a so-called "alpha" engineering prototype of its
forthcoming Model 3 electric car, which is due in 2017.
The disclosure, coming in its annual proxy filing with the
Securities and Exchange Commissions, offers a rare glimpse into the
status of one of the company's most anticipated projects. The
Silicon Valley electric car maker's past disclosures indicate there
is still plenty of time to complete the prototype and still launch
on target.
Tesla Motors still has more than 30 months to launch the car in
order to meet its target for launching the Model 3--designed to be
a far cheaper offering than the Model S sedan it currently sells
and Model X SUV slated for launch in the second half of this
year.
The Model 3 is expected to make the Tesla portfolio more
accessible. Tesla has said the vehicle will achieve 200 miles on a
charge and cost $35,000, about half of what a base Model S costs;
it will launch at about the time General Motors Co. and other
bigger rivals plan to introduce electric vehicles with similar
range and with similar price tags.
In its filing, Tesla noted Chief Executive Elon Musk now holds
26.7% of Tesla's stock, and the stake is valued at about $7.8
billion at the current share price. Mr. Musk founded the company in
2004 and remains the company's chief vehicle architect.
The company next week will announce a grid-scale battery pack as
well as a home battery, representing a new frontier for the
company's product ambitions. Mr. Musk had previously said the
company was working on a stationary battery storage product. In
addition, he has said the company could produce batteries at its
so-called gigafactory, which is under construction in Nevada, for
this same market.
Among Mr. Musk's target milestones for certain equity grants is
a commitment to developing alpha and beta prototypes of the Model
3, as well as completion of production of the vehicle. Tesla has
already completed both prototypes for the Model X SUV, leaving only
the official production of the vehicle on the CEO's to-do list.
Tesla's past disclosures help shed light on the company's
timeline for completing prototypes.
In its proxy statement filed in 2012, Tesla said it completed
the so-called alpha prototype of the Model S sedan in December
2010, or less than 20 months before the first delivery of the car
in June of 2012. The alpha model was described as an "engineering
prototype" and it was approved by the board one month after it was
completed.
The company then finished its "beta" prototype--described as a
validation prototype--in October 2011, about nine months before the
sales launch. Tesla has delivered 57,000 vehicles world-wide, and
aims to sell 55,000 in 2015.
While the company has yet to report a profit and faces
considerable hurdles, Mr. Musk, 43 years old, has built Tesla into
a force in the global auto industry. Its market capitalization of
$27.6 billion is bigger than Fiat Chrysler Automobiles' valuation,
but less half of General Motors Co. or Ford Motor Co. Tesla,
however, pulls in a fraction of the revenue and has a tiny
footprint compared with its Detroit rivals.
The company said its founder will work for an annual base salary
of $37,440 in 2015, equivalent to the minimum wage requirements in
California. That is up slightly from the $35,360 he earned in
2014.
The company said Mr. Musk, Tesla's biggest stockholder by far,
doesn't accept the salary.
In 2012, Mr. Musk was awarded $78 million in stock options.
Tesla also outlined compensation for certain executives,
including Tech Chief JB Straubel, who earned $17.1 million in total
pay in 2014.
Write to John D. Stoll at john.stoll@wsj.com
Access Investor Kit for General Motors Co.
Visit
http://www.companyspotlight.com/partner?cp_code=P479&isin=US37045V1008
Access Investor Kit for Tesla Motors, Inc.
Visit
http://www.companyspotlight.com/partner?cp_code=P479&isin=US88160R1014
Subscribe to WSJ: http://online.wsj.com?mod=djnwires