The bulk of the funds, $365 million, will be used for production engineering and assembly of its Model S, an all-electric family sedan that will seat seven and travel up to 300 miles per charge. Tesla expects to start Model S production in late 2011. The anticipated base price for the vehicle is $57,400. Purchasers will be eligible for a $7,500 US federal tax credit.

The federal loans is part of the Dept. of Energy's $25-billion Advanced Technology Vehicle Manufacturing Program, which provides incentives to new and established automakers to build more fuel-efficient vehicles.

The Model S will be Tesla's third vehicle. The company is already producing the Roadster; it has delivered more than 500 Roadsters to customers to date. Deliveries of the Roadster Sport begin this month.

Tesla has two showrooms in California but this summer plans to open showrooms in London, New York City, Seattle, and Miami. The London store opens later this week. Stores are also slated for Washington DC and Toronto.

In May, Daimler AG has acquired an equity stake of nearly 10 percent of Tesla Motors Inc. The two companies had previously been working closely to integrate Tesla's lithium-ion battery packs and charging electronics into the first 1,000 units of Daimler's electric smart car. Tesla says the investment enables the duo to collaborate even more closely on the development of battery systems, electric drive systems and in individual vehicle projects.

The partnership may have been helpful in obtaining the federal loans. In a statement, Energy Secretary Steven Chu touted Tesla's focus on accelerating the production of fuel-efficient vehicles in America. "These investments will come back to our country many times over, by creating new jobs, reducing our dependence on oil, and reducing our greenhouse gas emissions," he said.

In February , in order to increase its chances of receiving the loans, Tesla set aside previously announced plans to lease 89 acres of city- and county-owned land for a brand new headquarters, R&D and manufacturing campus. Instead, the San Carlos, CA-based company said it is working to secure an existing Silicon Valley facility for its R&D and drive-train assembly operations and another existing facility, likely in another California market, for the manufacture of Model S.

A Tesla source told GlobeSt.com at the time that the company is seeking 250,000 square feet for the power train assembly plant and 500,000 square feet for the Model S plant. The company's corporate offices likely will remain in San Carlos until after the other facilities are up and running, the source said.

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Tesla Lands $465M Loan from US Dept. of Energy

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