Tesla Motors will receive $350 million in loans from the U.S. Department of Energy to help finance the electric carmaker’s Model S and keep it on track for production in 2011.
Tesla Chief Executive Elon Musk made the announcement Wednesday in a newsletter emailed to customers. Mr. Musk said the department told him of the decision last week and that the money should be available in four to five months.
Tesla plans to unveil a “street-drivable prototype” of the Model S four-door sedan in March. Unlike Tesla’s Roadster sports car, which retails for more than $100,000, the Model S is expected to sell for closer to $60,000.
The San Carlos, California, company has produced more than 200 Roadsters and has a backlog of more than 1,000 orders.
Despite ongoing production delays, the electric car company raised $40 million in financing in December.
“We remain on track with our cost reductions and production ramp, so it appears highly likely that Tesla will meet the goal promised to those investors of becoming profitable by midyear,” Mr. Musk wrote.
Last month the company announced it was working with Daimler to create an electric version of the Smart car. Daimler has contracted Tesla to build the battery packs and chargers for an initial run of 1,000 cars and, pending results, could expand to tens of thousands of cars per year, according to the letter.
Mr. Musk also announced in the newsletter that the company was finalizing agreements to open six new sales and service centers in the United States, Germany, and England.