Tesla Motors has raised public awareness of electric vehicles by manufacturing attractive cars that offer enough driving distance between charges to compete with gasoline-powered vehicles.
Before Tesla Motors began manufacturing cars, electric vehicles widely were perceived as unattractive and underpowered, says James Billmaier, author of the book "Jolt! The Impending Dominance of the Electric Car and Why America Must Take Charge." They lacked the smooth handling and aerodynamic designs of the sporty Teslas, he adds.
Before Tesla, electric cars and hybrid gas-electric vehicles "didn't look or drive like real cars," Billmaier says.
How Tesla cars drive
The Tesla Model S has a range of 244 miles between charges with a 60 kilowatt battery, and a range of 306 miles between charges with a more powerful 85 kilowatt battery.
However, none of the Tesla models come cheap. Prices for the battery-powered Model S, a luxury sports sedan, begin at about $71,000, placing it out of reach for many buyers. According to Sebastian Blanco, editor in chief of AutoblogGreen, a blog that covers environmentally-friendly vehicle news, Tesla is following the same strategy used by Apple, the manufacturer of the iPad and iPhone, in betting that consumers will be willing to pay higher prices for quality products. And like Apple, Tesla also hopes to attract buyers who appreciate cutting-edge technology.
The long-range strategy calls for eventually introducing a more affordable Tesla model to broaden consumer appeal. In January 2014, CNNMoney reported that Tesla's goal is to release such a vehicle within about three years. It would sell in the $35,000 range.
The Associated Press reported that Tesla sold 2,150 Roadsters – its first vehicle -- before that model's production ended in early 2012. The company began delivering the new Model S to consumers in mid-2012. This car has a range of 265 miles per charge.
In January 2014, Bloomberg.com reported sales of the Model S had reached more than 25,000 units by the end of 2013.
The Los Angeles Times reported that Tesla expects to sell another 35,000 Model S vehicles in 2014. Tesla also is making plans to come out with a sport utility vehicle called the Model X. According to a February 2014 report from AutoEvolution.com, Tesla CEO Elon Musk is planning to launch the SUV in 2015.
Tesla: The victories so far
If accolades for Tesla vehicles are any indication, its strategy is working.
In January 2013, Motor Trend magazine named the Model S its car of the year. It said Tesla's electric powertrain -- which contains the components that generate automobile power -- outperformed many of its combustion engine competitors. In February 2014, Consumer Reports named the Model S electric the best vehicle on the road. The Model S was its top choice among all 2014 contenders.
Billmaier says he is a satisfied Model S owner.
"It’s the best car I have ever owned, and I've owned a lot of really nice cars. The technology is so much superior to a gasoline motor,” he says.
John Voelcker, editor of GreenCarReports.com, a website about fuel-efficient cars, says there are three important things that the Palo Alto, Calif.-based company has done to advance the future of electric vehicles.
1. Tesla discovered it could greatly reduce battery costs for an all-electric car by using small commodity cells, which have been used in cellphones and laptops. Most electric vehicles were using nickel-metal-hydride battery packs. Tesla's batteries are considered superior because they provide greater power and allow cars to drive greater distances between charges.
2. The company's first car -- the two-seat Roadster sports car -- proved electric cars could be both functional and attractive, Voelcker says. The vehicle's speed made it functional as a high-performance vehicle, while its sleek design made it more visually appealing than other electric and hybrid vehicles.
3. Tesla's second car -- the Model S sedan -- was large enough to appeal to a broader audience, making it competitive with luxury gasoline-powered vehicles.
Insurance discounts for electric cars
One of the appeals of hybrid and electric cars is they can save you money on your auto insurance and earn you credits on your federal and state taxes.
Loretta Worters, a spokeswoman for the nonprofit Insurance Information Institute, says some auto insurance companies offer discounts of up to 10 percent.
Pete Moraga, a spokesman for the Insurance Information Network of California trade group, says it's important for consumers to shop for the carrier with the best hybrid and electric car insurance discounts, as some insurers may offer better discounts than others.
"Each one has a different program," he says.
According to the U.S. Department of Energy website, electric vehicles are eligible for a federal income tax credit of up to $7,500. The credit will vary according to the capacity of the battery that powers the car. Each state has its own incentives for electric-powered cars. In November 2013, the National Conference of State Legislatures reported that state rebates or tax credits for these vehicles ranged from $1,000 in Maryland to $6,000 in Colorado.