Tesla slashes production cost of Roadster, claims profitability within reach

Despite its small size, Tesla Motor Company, builder of the famed Roadster electric sports car, is as embattled as any major manufacturer these days. Between a lawsuit from a former CEO and materials costs far beyond the asking price of the Roadster, things haven't been going well lately.

But today CEO Elon Musk revealed that production costs have been cut to about $80,000, and the door to profitability is now open, reports MSNBC. The cost savings come largely from increased volume production and automation of the build process. Moving production of the battery packs from Asia to California also helped save money.

"This may sound counterintuitive, but our unit cost actually went down and quality improved as we went to a more automated system and could iterate quickly with engineering to find design efficiencies, " Musk said.

With the new cost-per-unit somewhere around $80,000 - down from $140,000 in mid-2007 - the Roadster's $109,000 sticker price could turn Tesla back toward profitability as early as July.

A profitable Tesla could mean the difference between turning the corner toward mainstream production of its recently-unveiled Model S Sedan and continuing on as the builder of a very low-volume, specialty-market electric sports car.

Viability is a key concern of the current administration when handing out federal development loans, and Tesla's new factory plans hinge on receipt of a $350 million loan to fund construction and start-up.