Musk shows off Tesla's fastest car yet

A NEW MODEL: Elon Musk, chief executive officer of Tesla, in Berlin on Dec. 1, 2020. Liesa Johannssen-Koppitz/Bloomberg

Elon Musk billed Tesla's newest vehicle, the Model S Plaid, as a halo product that proves the superiority of electric cars at an event marking the start of deliveries to customers.

"Why make this really fast car that's crazy fast?" the chief executive officer asked rhetorically outside Tesla's factory in Fremont, California. "There is something that's quite important to the future of sustainable energy, which is that we've got to show that an electric car is the best car, hands down."

Musk touted the Plaid as being be able to go from zero to 60 miles per hour in less than 2 seconds, though that time excludes an initial roll forward, according to the company's website. The car offers an estimated 390 miles of range, reaches a top speed 200 mph and costs $129,990 in the U.S.

"This is what I call limit-of-physics engineering," said Musk, wearing a black leather jacket with a plaid logo on the back. Tesla shares rose as much as 1% to $616 before the start of regular trading Friday.

The Model S was Tesla's breakthrough sedan, with initial deliveries starting in 2012. While the older Model S and X are dwarfed by the newer and cheaper 3 and Y, the higher prices they command make important contributions to the company's profitability. The first 25 Plaid cars were handed over to customers Thursday, and Musk said he expected the company to deliver 1,000 a week by next quarter.

During a less than 30-minute presentation, Musk rattled off improvements including a new battery pack, carbon-wrapped rotors and tri-motor powertrain. The name Plaid is a reference to a high-speed space travel scene from the 1987 comedy movie "Spaceballs."

Changes to the exterior design made the car more aerodynamic. Inside, the front seats are moved forward to increase room for passengers in the rear, which now features a second touch screen.

Musk compared the car's entertainment system to the performance of a Sony PlayStation 5 and said its 22-speaker sound system offers a home theater-like experience.

"If you think about where the future of the car is, often in Autopilot or self-driving mode, then entertainment is going to become increasingly important," he said. "You're going to want to watch movies, play games, use the internet."

The event lacked a "one more thing" surprise about other vehicles in Tesla's product pipeline, such as the Semi or Cybertruck. Musk also didn't provide any update about new battery cells the company is developing in-house or discuss the decision to kill a longer-range Plaid+ version of the Model S.

The eightfold gain in Tesla's stock price last year made the company the world's most valuable automaker and helped boost investor interest in the broader electric-vehicle space. But the EV market leader has gotten off to a disappointing start to this year. The shares dropped 14% through Thursday's close, well behind the 13% gain for the S&P 500 Index.

Tesla typically hosts one or two splashy events per year to keep customers excited and plunking down deposits on products. They also serve an important promotional purpose, since the company avoids spending on traditional advertising.

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