Tesla lets public tap electric-car patents

CEO hopes access boosts market

A visitor steps into a Tesla Motors Inc. Model S at the company’s store in the Short Hills Mall in Short Hills, N.J. earlier this year. Tesla CEO Elon Musk said Thursday that the company is making all its patents public.
A visitor steps into a Tesla Motors Inc. Model S at the company’s store in the Short Hills Mall in Short Hills, N.J. earlier this year. Tesla CEO Elon Musk said Thursday that the company is making all its patents public.

Elon Musk, Tesla Motors Inc.'s co-founder and chief executive officer, said the company is making all its patents public in a bid to expand drivers' adoption of battery-powered vehicles.

The carmaker won't initiate patent suits against "anyone who, in good faith, wants to use our technology," Musk said Thursday on the Palo Alto, Calif.-based company's website. At Tesla's June 3 annual meeting, Musk said too few automakers offer "serious" electric vehicles, and he pledged to do something about it.

"Tesla Motors was created to accelerate the advent of sustainable transport," he said. "If we clear a path to the creation of compelling electric vehicles, but then lay intellectual-property land mines behind us to inhibit others, we are acting in a manner contrary to that goal."

Tesla, poised to begin developing as many as three sites for a proposed $5 billion battery "gigafactory," set a goal in 2006 of being a catalyst to move the auto industry from using petroleum to using electricity to power vehicles. While the company intends to increase deliveries of its $71,000 Model S sedan by more than 56 percent this year, it remains far from Musk's goal of selling hundreds of thousands of vehicles annually. The Model S price does not include federal tax credits.

Musk said electric cars are such a tiny slice of the auto market, and other automakers are doing so little with them, that he doesn't see allowing others to use Tesla's technology as hurting the company.

"We think the market is plenty big enough for everyone," Musk said. "If we can do things that don't hurt us and help the U.S. industry, we should do that.

"Our true competition is not the small trickle of non-Tesla electric cars being produced," he said, "but rather the enormous flood of gasoline cars pouring out of the world's factories every day."

Tesla has collaborated with major carmakers on electric cars, supplying battery packs and motors for Toyota Motor Corp. and Daimler AG vehicles. Both companies also hold stakes in Tesla.

The automaker has more than 160 issued patents for things such as a system to protect battery packs from overcharging and an improved rotor construction in an electric motor, according to the website of the U.S. Patent and Trademark Office. Some of its more recent publicly available patent applications relate to computer-user interfaces and a port to allow for emergency maintenance of a high-energy battery pack.

Shares of Tesla, which saw its stock climb fourfold last year, fell 95 cents Thursday to close at $203.52. The shares had gained 36 percent this year through Wednesday.

Tesla will begin delivery of cars to customers in the Chinese cities of Hangzhou and Shenzhen in the next two months.

The company is also setting up service centers in the two cities, Beijing-based spokesman Peggy Yang said Thursday. The company handed over cars in Beijing and Shanghai in April, she said.

China is set to become the largest market for electric vehicles by 2019, Bayerische Motoren Werke AG's China head Karsten Engel said last month, as the government seeks to have 500,000 alternative-energy vehicles by 2015.

Information for this article was contributed by Craig Trudell, Susan Decker and Alexandra Ho of Bloomberg News and Jerry Hirsch of the Los Angeles Times.

Business on 06/13/2014

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