Tesla Motors’ new powertrain is undergoing durability testing and is on track for production in August, according to a blog post from Chief Technology Officer J.B. Straubel on Wednesday. 

The new system includes an improved inverter and motor, as well as a new gearbox that turns the two-speed into a one-speed. 

Straubel wrote that the new powertrain improves torque by more than 30 percent, enabling the Roadster to travel a quarter mile in 12.9 seconds and to continue to reach a top speed of more than 120 mph, which also extends the range, giving the car an extra 10 miles before it needs to recharge. 

Tesla originally had expected a range of 250 miles, but last year said it was aiming for a range of “greater than 200 miles” instead (see Gizmodo post).  

What’s the next step for the transmission? “Testing, testing and then more testing!” Straubel wrote. The company is testing the gearbox, motor and inverter at high and low speeds and temperatures, and also will be upgrading its engineering fleet of vehicles and several of its marketing vehicles to test the components in fully assembled cars, he said.

One car will be tested in Death Valley for “aggressive hot-weather thermal-limit testing” and hill climbing tests, while another will be running a 40,000 kilometer durability test around a track at high and low speeds, over rough cobblestone roads, through salt spray baths and potholes, according to the post. 

Straubel expects the new transmission to come standard on Roadsters starting with the forty-first car, which the company anticipates it will produce in August.

“Although we faced a significant setback last fall when we realized the previous two-speed design was not sufficiently durable, the Tesla powertrain team is accomplishing an extraordinary feat in not only overcoming this setback, but engineering a superior outcome for Tesla customers,” Straubel wrote.

In December, after a series of transmission-related delays, Tesla had said it would deliver the first batch of speedy sports cars with an interim transmission that would take about 5.7 seconds to get from 0 to 60 mph, instead of the previously promised “about 4 seconds,” but would replace those transmissions with a higher-torque version – free of charge – once the new transmissions were ready.

The next month, the company announced it had designed a new one-speed transmission system that would solve its problems, and earlier this month, Tesla said it would introduce the new transmission system when it enters full production by September (see Tesla Announces New Transmission and Tesla Production Slower Than Expected). 

Mike Omotoso, senior manager of global powertrain at at J.D. Power, called the news “a significant step” for Tesla. 

“It’s good news that they’ve come up with a technology that increases power, speed and still has great fuel economy,” he said. “They’ve improved the performance of the vehicle, and the one-speed transmission so far seems to be more reliable than the two-speed. It’s a pretty expensive vehicle at $100,000, and customers expect it to be a high-performance car; people don’t want problems with it.”

If the new powertrain works out as expected, the company could have a market in licensing it out to other vehicle manufacturers and could also use it in its own future models, he said. 

While replacing the interim transmissions won’t cost customers anything, it certainly will take a toll on Tesla, Omotoso said. Normal transmissions cost $1,000 or $1,300, he estimated, but more complex transmissions like Tesla’s could cost “thousands of dollars.”

“In the short term, they’ll definitely take a loss,” he said. “I don’t know if the company’s profitable or not at the price they’re charging – they had some pretty high startup costs – so they would have to hope they can either increase volumes next year or license the technology to recoup their cost in the future.”

In February, when Tesla delivered its first production Roadster to its chairman, PayPal co-founder Elon Musk, CEO Ze’ev Drori skirted a question about the cost to the company (see Tesla CEO Talks Cash and Speed).

“We don't measure in terms of cost,” he said at the time. We made a commitment to our customers and we abide by our commitment.” 

But Omotoso said the company will have to begin to think in terms of cost, and he recommended that Tesla put off its $250 million initial public offering, which Musk said the company has planned for the end of this year, until it has ironed out its problems and can show full production and happy customers. 

The target delivery date of August might also prove ambitious, even though it behooves Tesla to switch to the new transmission (and avoid the interim transmission and replacement costs) as soon as possible. 

The company said earlier this month that production has been slower than expected and that it hadn’t yet reached its goal of producing one car per week. At that rate, Tesla wouldn’t produce its forty-first car for another eight months. Although, to be fair, the company expects to ramp up to producing 100 cars per month by November. 

“The whole program has been delayed almost from the beginning, so I guess people are getting used to it,” Omotoso said.  

The improved transmission also could help make Tesla competitive against larger automakers such as General Motors Corp, he said. 

The manufacturer plans to release a sporty plug-in hybrid, the Chevrolet Volt, in 2010. Tesla has said it expects to bring a $50,000 to $70,000 sedan (codenamed WhiteStar) to the market at the end of next year, offering both an all-electric and a plug-in-hybrid version (see CNET post). 

GM originally expected the Volt to cost about $30,000, “but now I’m seeing anything from $40,000 to $48,000, and you might have to lease the battery separately,” Omosoto said. “So if the price keeps coming up and Tesla’s comes down, and they can get to the market before GM, they might [prove competitive]. It would be a little embarrassing for GM to get beat be a small company like Tesla.”