The Electric Stars 168
something that look like a very standard vehicle, such as a
Toyota Corolla, and it would have cost $70 000. But nobody
would pay that for what looks like a mid-size economy
sedan. But people are willing to pay $100 000 for a fast
sports car.”^339
So the strategy Tesla had was to begin with a high-
price, low-volume car. This model’s codename was Dark-
Star after a classic science fiction movie.^272 You can only
charge a high price for a limited number of cars, and you
can expect a customer to pay a high price for a sports car.
DarkStar would prove that the customers wanted a high-
performance electric car. It would also give the company
credibility. The suppliers would be willing to write con-
tracts with Tesla and Tesla could find more money from
investors who now trusted the company.
WhiteStar would be phase two. That’s a mid-price,
mid-volume car. The profits from the DarkStar would pay
for the development of the WhiteStar. “In keeping with
a fast growing technology company, all free cash flow is
plowed back into R&D [Research & Development] to drive
down the costs and bring the follow on products to market
as fast as possible,” Elon said.^247
Phase three would be the car with mass market poten-
tial. The high-volume, low-price car, with the codename
BlueStar. “Our long term plan is to build a wide range of
models, including affordable priced family cars,” Elon said.
Tesla thought it would cost $25 million before they
could deliver the first DarkStar, but in the end, they would
need $140 million. “We hugely underestimated the chal-