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Citing "Pent-Up Demand," Tesla Motors Says Model S Reservations Have Exceeded Expectations

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    Tesla Model S is already a hot item, with 520 orders taken. | September 15, 2009

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Citing "Pent-Up Demand," Tesla Motors Says Model S Reservations Have Exceeded Expectations

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    WASHINGTON — Tesla Motors said Wednesday that it has taken 520 $5,000 reservations for its electric Model S sedan, which is not due in customers' hands for more than two years. The Model S was introduced last week and made its East Coast debut on April 1.

    It did not name any of the customers who had made reservations, but Tesla has a large clientele of celebrities.

    Tesla says the "anticipated" base price of the up-to-seven-passenger Model S is $49,900 after a federal tax credit of $7,500. The $5,000 reservation fee is refundable.

    "Frankly, the number of cars reserved in the first week has exceeded our optimistic internal projections," said Tesla CEO, chairman and product architect Elon Musk in a statement. "Enthusiasm surrounding the Model S is proof that there's pent-up demand for more affordable, fuel-efficient vehicles — including those made in America."

    Tesla said it is also taking reservations for the Model S Signature Edition with a $40,000 reservation fee. It will build only 2,000 Signature Edition cars.

    Model S production is slated to begin in late 2011. Tesla has applied for a $350 million loan from the Department of Energy's Advanced Technology Vehicle Manufacturing Program, which would be used to build the Model S assembly plant in California.

    Tesla also recently announced a new system for ordering its Roadster. New customers locking in a delivery slot for delivery after November 1, 2009, will pay a refundable reservation fee of $9,900 in the U.S. Previously the Tesla Roadster had a two-tier structure — a $60,000 reservation fee for customers who wanted to lock in a production slot and $5,000 for those who didn't. Tesla says the new setup "make[s] things much simpler.

    "The initial threshold to Roadster ownership has now become much lower," said Michael van der Sande, Tesla senior vice president of global sales, marketing and service.

    Inside Line says: The line is forming for the Model S, which is impressive given the fact that production is more than two years away. — Anita Lienert, Correspondent

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