Tesla Motors (
) was perhaps the most-anticipated initial public offering of the
last few years, certainly of the new decade. In the three weeks
after shares began selling on June 29, Tesla's investors might be
forgiven for thinking that they had stepped into a ride in one of
the company's lightning-quick, tight-handling cars.
Tesla's IPO valued the shares at $17 per share, but in the first
two days of trading the company's
soared to nearly $24. Despite managing only a single profitable
quarter in its history, investors initially found the company's
high flying, well-publicized ambition irresistible. Those first few
days had the feeling of the tech bubble's glory days, when
speculative ventures with no business plans, cash flow or long-term
goals could pull in $100 million in an offering.
The new car exuberance faded after a few days, though, and
skepticism set in. Tesla's share price tumbled to $15.80, below the
IPO level. Then it staged another recovery, climbing its way back
up to $22 per share, before slipping again.
So what's the future for Tesla? It's going to depend largely on the
Tesla Model S, which is the codename for a lower-priced, consumer
sedan being developed by Elon Musk and his company. Orders have
already been placed, although the car won't hit roads until 2012.
Big investments from Toyota and an agreement to jointly develop an
electric version of the RAV4 mid-size sport utility vehicle may
help tide the California-based startup over until it can start
selling its cars in earnest.
In the meantime, investors might see one of Tesla's performance
Roadsters cruising - quietly and cleanly - down the freeway.
If they're lucky, that is - only 1,200 have been built.