The plan at Tesla Motors has always been to go beyond its first vehicle, the $100,000 electric Roadster, to make more-affordable electric cars--a plan that had come to depend on the startup receiving a hefty loan from the government. Today, the Department of Energy announced that it has approved that loan--in the amount of $465 million. The money could allow Tesla to bring its Model S electric sedan to market, as planned, by 2011.

The company said in a statement that $100 million will be used to construct a manufacturing facility for the company's electric power train (the battery, motor, and controls), which it plans to sell to other automakers. The rest will be used to engineer and build the Model S.

The base version of the Model S will sell for about $50,000. Tesla will offer three versions of the car with different ranges: 160, 230, or 300 miles. Even the smallest battery pack will give the vehicle more range than several planned electric cars from other manufacturers. Electric vehicles from Ford, Nissan, and Coda automotive, due out in the next couple of years, will have a range of about 100 miles.

Tesla has delivered about 500 of its Roadsters so far, and the company predicts that its Roadster division will be profitable this year.

The DOE loans are part of the $25 billion Advanced Technology Vehicles Manufacturing program, which was first signed into law in 2007 and appropriated last September. The DOE also announced today that it had approved a $5.9 billion loan for Ford, for developing advanced vehicles and retooling factories to make cars that use less gas. The DOE also approved a $1.6 billion loan for Nissan North America, which will be used to modify a factory in Smyrna, TN, to make electric vehicles and battery packs. Nissan plans to start selling an electric car in the United States next year, which will be made in Japan until the Smyrna plant is ready in 2012.

Mazda's Tribute SUV uses Ford technology

Mazda R&D chief Seita Kanai confirmed last week that his company has no plans to commercialize its own hybrid technology, according to a report last week in Automobile Magazine. The Japanese automaker markets a hybrid version of its Tribute, a small SUV, which Automobile Magazine describes as a Ford-engineered system closely resembling the Ford Escape Hybrid. Kanai says that Mazda will instead achieve mandated fuel economy savings by improving engines and transmissions, and by redesigning vehicles to reduce their weight.

But Kanai also admitted that Mazda simply couldn't afford to field a hybrid. And he acknowledged that the resulting technology gap represented a worrisome problem for the company with many buyers enamored of hybrids. Here's how Kanai put it, according to Automotive News:

"We're in real trouble," Kanai said of the rapidly falling hybrid prices. "It's a threat. We don't have the resources to get involved in that kind of competition."

The company could be even further behind if one is to believe plans by automakers such as Nissan and Ford to aggressively push into fully battery-powered electric vehicles (EVs). Nissan is considering selling its first battery EV in the U.S starting next year--two years faster than it had previously planned, according to another report today from Automotive News.

Quoting Mark Perry, Nissan's U.S.-based product planning and strategy director, the report says that the rollout of Nissan's EV will track the rollout of charging infrastructure, city-by-city. Presumably a thumbs up from the Department of Energy on Nissan's request for loans to build an EV battery plant in Tennessee could also affect the automaker's appetite for taking a bet on EVs in the U.S.

Don't be fooled by all the electric-vehicle announcements in recent months: these vehicles won't be taking over the roads by 2050, according to three-quarters of a four-person panel at last weekend's MIT Energy Conference (a panel that included a representative from Ford Motor Company, no less). The fourth person, and sole dissenter, was a representative from Better Place, a company that's helping Israel, and a number of other countries, as well as cities, end its dependence on gasoline by building infrastructure for electric vehicles. He thinks EVs will take over completely by 2050.

There's good reason to believe he's wrong.

The moderator, Daniel Snow, a professor at Harvard who studies the "last gasps" of technologies--how incumbent tech keeps hanging on in the face of seemingly superior challengers--drew on the oft-cited example of microprocessors. For years, researchers have been touting experimental alternatives to silicon-based transistors (nanotube, exotic semiconductors, shape-shifting molecules), but silicon is still the backbone of microelectronics because of heavy investment in research in silicon, economies of scale, and inertia: chip makers know how to work with it, so they keep working with it.

The same will probably be true for internal combustion engines, Snow said. Although electric vehicles have many notable advantages over conventional vehicles--instant torque, zero tailpipe emissions, much better efficiency--cars with internal combustion engines could continue to dominate the streets long into the future. It's hard to beat the energy density of liquid fuels such as diesel and gasoline. And there's no clear limit to how little gasoline a car might consume: you might even one day have a superlight car that gets 10,000 miles to the gallon, Snow speculated. "Old technology can persist because of the learning curve," he said.

The economy could make it even harder for new technologies to get established, said John Casesa, an auto-industry analyst. He thinks that in 50 years' time, electric vehicles will still only make up about 10 percent of the vehicles on the road.

John Viera, the director of Sustainable Business Strategies at Ford Motor Company, agreed with Casesa's assessment. Ford recently announced two electric vehicles, the first of which is due out next year. But like Casesa, he doesn't think that EVs will make a big dent in the number of internal combustion engines out there. Citing depleting oil resources, he does, however, think that by 2050, ethanol from grass, wood chips, and other cellulosic materials will take over for petroleum in fueling internal combustion engines. (Note: Later in the conference, a representative from BP said that we have 140 years of oil left.)

The big reason that Viera thinks that EVs will be a long time coming is cost. He said that battery packs for EVs add $12,000 to $15,000 to the cost of a car, so most people won't buy electric vehicles. Eventually, battery prices will come down, but to get to this point, he thinks that someone needs to come up with a better way of selling electric vehicles. One option, he said, with a nod to Better Place, is to sell the car without including the price of the battery.

In the Better Place model, the company owns the battery, and drivers pay a monthly subscription based on the miles they drive--like paying for minutes on a mobile phone. Sven Thesen, who is in charge of sustainability strategy at Better Place, predicted that light-duty cars can "move completely to electric" in 40 years. And he thinks that biofuels will be used for airplanes.

Why the optimism? It's not just his company's subscription business model. Better Place is starting in Israel for a number of reasons, not least that the government there has decided to get Israel completely off of oil by 2020. To do this, it's established a tax of 72 percent on new gas-powered cars, compared to a 10 percent tax on electric vehicles, Thesen said. With carbon dioxide levels rapidly rising, he thinks that everyone's got to take similarly decisive action: "Burning oil is bad."

But with U.S. automakers failing, and people struggling in general to make ends meet, heavy taxes on gas-powered cars aren't going to be approved in the United States anytime soon. "We don't reelect officials who talk about a gas tax," Casesa said. "I think it's time for some national introspection."