Tesla to build all-electric luxury saloon in California

Tesla has announced that it is to assemble its all-electric Model S luxury saloon in a new production facility in the heart of Silicon Valley.

The Model S is Tesla’s zero-emission, five-passenger luxury saloon powered by a lithium-ion battery pack. It is expected to have a base price of about $60,000 and get about 240 miles per charge with ‘exceptional performance’. The first saloons are likely to roll off the assembly line in late 2010.

Tesla President and CEO Ze’ev Drori announced that construction of the 89-acre new $250 million facility would begin in the summer of 2009. When fully operational, the facility will employ approximately 1,000 workers.

Tesla selected San Jose in part because the region already enjoys a high concentration of highly skilled engineers and support infrastructure. The factory – expected to achieve gold certification from U.S. Green Building Council Leadership in Energy and Environmental Design (LEED) – will be 20 miles from the current headquarters in San Carlos, ie. nearby for the current 250 employees.

“Big deals like this happen when both parties have something significant to gain,” said Drori, who praised San Jose Mayor Chuck Reed’s 15-year “Green Vision” job-creation initiative. “Locating Tesla’s headquarters, manufacturing and R&D in San Jose will allow us to proceed with minimum disruptions and virtually no dislocations.”

Tesla’s first production vehicle is the Roadster, a zero-emission, all-electric, two-seat sports car. On sale now in the United States and Europe, the Roadster is assembled at a Group Lotus PLC factory in Hethel, U.K. Tesla has no plans to move Roadster production.

Tesla, which has delivered about 30 Roadsters so far, announced last week it was ramping up production amid scorching demand. About 1,200 people have put down deposits to reserve a Roadster.

Tesla also announced recently a range of high-profile new appointments of industry expertise. Executive Vice President Mike Donoughe, who spent 24 years at Chrysler, is overseeing Tesla’s Model S and Roadster programmes. Chief Financial Officer Deepak Ahuja was formerly controller at Ford. Chief Designer Franz von Holzhausen, former director of design for Mazda North America, is designing the Model S.

“Tesla has amazing momentum right now. The excitement within the company is palpable,” said Tesla Product Architect and Chairman Elon Musk. “The company has clearly taken production of all-electric vehicles to the next level, and the Model S assembly plant will dramatically accelerate our growth.”