An Electric Dream

Inside a messy garage on a side street in the unglamorous Silicon Valley suburb of San Carlos, David Lu is struggling to make the shift to the future of transportation. The 25-year-old engineer taps away at a laptop, while behind him technicians crawl over a sinewy yellow sports car with a jumble of wires spilling from its carbon-fiber body. They're trying to work the bugs out of the transmission for this high-speed racer. "How the transmission handles, is still a subject of debate," says Lu. But something's different in this monster garage. On the walls, big yellow and red signs warn: DANGER: HIGH VOLTAGE. And the car has a thick black electrical plug sticking into it. This two-seat hot rod—which slingshots from 0 to 60 in less than 4 seconds—is powered by the same batteries as Lu's laptop. And what's even more shocking: This automotive antidote to our oil addiction does not come from a big car company. It is the work of Tesla Motors, a Silicon Valley start-up with 250 employees. Maybe you caught a glimpse of the Tesla Roadster making a cameo at the end of last year's documentary, "Who Killed the Electric Car?"

Or maybe you heard that celebrities like George Clooney and Matt Damon already have put down deposits on this $98,000 road rocket. Or perhaps you know that Silicon Valley A-listers like the Google guys are Tesla investors. Even Detroit, long derided as environmental knuckle draggers, is showing respect for tiny Tesla. "They have a real shot at success," says GM car czar Bob Lutz, who credits Tesla's arrival with jump-starting GM's plans to build its Chevy Volt plug-in hybrid electric car coming in 2010. "Their Roadster, if and when fully reliable, is an extremely attractive proposition."

That "if and when" is proving problematic. This green machine was originally due to hit the road this month. But that tricky transmission and other mundane issues for major automakers—like crash-testing the cars—are taking longer than the neophyte auto moguls expected. It now looks like customers won't get their cars until early next year. "I had a friend cancel his order because he didn't want to wait," says Chris Paine, the director of "Who Killed the Electric Car?" who still has his deposit down.

Some critics see Tesla as woefully underfunded with $105 million in start-up money, from a variety of Valley players like Jeff Skoll, eBay's original president, and the Technology Partners venture capital fund. The car business, the auto analysts warn, takes billions, not millions. All the delays have editors of auto-buff magazines wondering if Tesla is for real. "Until they have a drivable car, everything else is just flapping their jaws," says Car and Driver editor Csaba Csere, who's been awaiting a promised test drive for months. Tesla's overwhelmed executives hope everyone will be patient as they work through a long list of tests and tweaks. "Everybody will tell you that starting a car company is really hard," says Tesla's intense 47-year-old cofounder Martin Eberhard. "And they're right."

You could fill a junkyard with the magnificent failures in automotive history. There's Preston Tucker, who built just 51 of his ahead-of-its-time eponymous model in the 1940s, and then in the 1980s there was John DeLorean's gull-winged sports car, which is best remembered as a movie prop. But electric vehicles have proved a car conundrum that has confounded giants from Thomas Edison to General Motors. Guzzling gasoline, while environmentally incorrect, has always been cheaper and easier than propelling pollution-free in an electric car, with its balky batteries, limited driving range and endless recharging time. In the '90s, those factors helped short-circuit GM's EV1, whose ignominious death was the subject of Paine's documentary. Nearly a century ago, Edison was so frustrated by the failure of his electric car that he wrote a note of surrender on a napkin over dinner with Henry Ford. "The electric car," Edison wrote, "is dead."

What makes Tesla—named for the inventor of alternating current—any different? For starters, Tesla's timing may be perfect. Ever since Al Gore let us in on the inconvenient truth, the idea of an electric vehicle has emerged as the purest play against global warming, since cars spit out 20 percent of the greenhouse gases that heat the planet. Plus, Tesla's founders and financiers created a compelling car that blends Silicon Valley smarts with the kind of pulse-pounding performance that earnest, eat-your-peas electric cars always lacked. They're powering their car with a 950-pound bundle of 6,831 lithium-ion cells, each about the size of a AA battery, which come from a device these Valley boys know something about—a laptop computer. Lithium ion is the new battery of choice for electric cars—Toyota and GM are looking at it—because it goes farther on a charge (Tesla claims well over 200 miles) and doesn't take as long to juice up (about 3.5 hours with a special garage charger, or seven hours with a conventional plug). And all this technology is wrapped in a curvaceous car based on the exotic Elise by boutique British carmaker Lotus, which is building the Roadster for Tesla in Hethel, England. The first year's production of 600 cars is sold out.