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Tesla faces toughest challenge yet to meet expansion goals

Musk: "We have a lot of work to do."

Tesla Motors Inc., on a roll this past year with its highly praised Model S electric vehicle, faces its hardest challenge is yet to come: achieving CEO Elon Musk's bold goal of increasing the company's estimated 2013 U.S. volume of 20,000 units to 250,000 -- and to 500,000 globally -- by the end of the decade.

In an exclusive interview with Automotive News, Musk candidly acknowledged the challenges facing Tesla, saying, "We have a lot of work to do."

Automotive News on Monday will publish an in-depth analysis of the challenges facing Tesla. To grow to its hoped-for volumes when its $35,000 Gen III cars arrive in a few years, it must transform from an automotive boutique to a volume automaker.

It will have to:

  • Convince mainstream shoppers to trust electric-car technology.
  • Finance a vehicle platform housing several variants.
  • Expand its sales and service capacity vastly.
  • Scale up its manufacturing output by a factor of 20.

"That's a lot different than what he (Musk) is doing in niche volumes right now," says a veteran executive for Detroit 3 and Japanese automakers.

Top executives who talked to Automotive News expressed concern that the automaker's ambitions may overreach its abilities.

"To go from 2,000 to 20,000 units is already pretty impressive," said one executive at a German brand. "We are clearly seeing high professionalism behind it. It's a nice product. It's a nice story.

"Now the question is how strong do you need to be to continue telling that story, to move from 20,000 to 200,000?"

For the full story, go to on Monday.

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