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Tesla Motors Repays $465M Government Loan 9 Years Early
Tesla Motors announced today it has completely repaid the $465 million loan from the U.S. Department of Energy the company received in 2010. The funds were generated by Tesla through a recent sale of their stock, worth close to a billion dollars. The stock price had risen sharply after the company reported its first profitable quarter (and the stock still sits roughly 50% higher than before their earnings release). Today's payment of $451.8 million finished off both the loan's principal and its interest, nine years before the final payment was due. Tesla CEO Elon Musk said, 'I would like to thank the Department of Energy and the members of Congress and their staffs that worked hard to create the ATVM program, and particularly the American taxpayer from whom these funds originate. I hope we did you proud.'
And, Solyndra ends up like Solyndra because we lost a subsidy battle with China.
I'm not sure if you are reporting the fact, or complaining about it. If you are just reporting it to provide accurate information, kudos for you. Not only are you are well informed, you have more common sense than most people I know (or know of), and please stop reading here :).
I'm forced, however, to remember anyone who complains about "subsidy battles" that the USA is huge on subsides, and wages this battle against many countries, several times winning it. Orange/orange juice and corn are quick examples.
Unfortunately, subsidies are a necessary evil, specially since they are, many times, not a tool to fight an external competitor, but to regulate the internal market. In this, no country is blameless.
morcego
I think history has proven this again and again I believe that the technology for electric cars for everyone is not quite there yet, so focusing on the luxury market segment they can generate enough demand to have the possibility to actually work on this technology and, eventually, drive the prices down.
It's the same thing that happened with smartphones and other technologies, once the acutal product is there and proves to be profitable, technology advances much more strongly in that direction, helping to drive prices down and get more customers and markets.
Actually, that comment was sort of amusing because, while Musk is actually African, he's about as white as I am.
The car did well enough through all the ugliness that I'm going to use it year round. The range did drop off dramatically on the days when it was about 0 (F). But my commute is only 7 miles, so there was really no problem with using it for getting to work. The other thing that helped was that the car could be warmed up while it was still plugged in. I was also going to get a stage 2 charger installed, but with my typical daily use, the car is fully charged off 110 after midnight. I don't think I'll get a stage 2 charger until I get a second electric.
The Model S is comparable in purchase price to an otherwise equivalent gas-powered car. It's a large, high performance luxury sedan, and other cars of that size, horsepower, and trim level run $75 - $100k as well.
This
Texas is working on banning them too. I wonder if other companies that received loans are running into walls created by state and local governments with republican majorities.
Having to work for a living is the root of all evil.
Did Tesla have to pay a penalty for early repayment? You know, like banks will do if you want to pay a mortgage off early. Or is it a different set of rules?
Most normal home mortgages do not have a pre-payment penalty.
If your mortgage has a early repayment penalty then you got screwed hard. The only time I have sever seen that is when someone had no idea at all what they were doing and said yes to everything the banker asked.
Let me guess you also paid "points" as well. Intrest rates have been so low that paying $1000 in points to lower it by 0.01% is worthless unless you are buying a 2.5million mansion.
Do not look at laser with remaining good eye.
Oddly enough the loan program was established under the Bush administration.
From wikipedia article: http://en.wikipedia.org/wiki/Tesla_Motors http://www.drivingtoday.com/news_this_week/2009-07-17-4337-driving/index.html#axzz2U4akRe2c
The low-interest loans are not related to the "bailout" funds that GM and Chrysler have received, nor are they related to the 2009 economic stimulus package. The Department of Energy loan program was created in 2007 during the George Bush administration in order to get more fuel-efficient vehicle options to U.S. consumers and to decrease the country's dependence on foreign oil.
Taken as a whole, government investments like have very rarely lost. Even in the contentious past 5 years, the government investment in emerging technologies have been very profitable, even with the poster boys like Solyndra which are used to argue that all government investment in technology is a bad idea. This argument is usually made on the Internet, which is more than a little bit ironic.
You are welcome on my lawn.
Taxes aren't stealing - they're part of an agreement you've made with the government by continuing to live in the country.
In Solyndra's case the tax money was used to invest in a superior type of solar panel technology that ultimately turned out to cost more than the heavily subsidized Chinese solar panels. I guess the government could just stick to blowing people up, but I'd much rather prefer all the new technology and progress.
Anyone who wants to pay $30K for a car is not going to be too concerned about gas costs.
I am, and gas costs made me decide to pay $30K for my Nissan LEAF.
I analyzed TCO (excluding maintenance costs, which are much lower for electrics, but I couldn't quantify that so I just ignored it) for about 20 different vehicles, including EVs, hybrids and pure ICE vehicles,. My model assumed that the new vehicle was going to be an additional vehicle, and that the other (gas-burning) vehicle would be available for trips beyond the range of the EV. I assumed very conservative ranges for the EVs, for example I estimated the LEAF's range at 60 miles (it's really more like 80-120, depending on conditions). Finally, I created a statistical model of my driving habits and calculated the total cost over 8 years.
The result was that the three EVs I looked at had the top three spots... they were the cheapest to drive overall, in spite of being by far the most expensive up front. Even better, thanks to tax credits the break-even point was at 2-3 years. Without the tax credits it was about 6 years. The vehicle immediately behind the EVs was the 18K Honda Insight hybrid, then a mix of other hybrids and more-efficient gas vehicles and finally a long tail of gas vehicles trailing the pack.
Of course, your driving patterns may be different, your electricity costs may be higher or gas prices lower (oh, I assumed that gas prices would continue increasing at the same rate they've increased over the last 8 years), etc., etc, etc., but I've walked several other people through applying my model to their situations and in every single case the EVs have been extremely competitive -- and usually the very cheapest.
In practice, what I've found -- for me -- is that my model was very conservative. In fact, the LEAF is even cheaper than I expected. Partly that's because I was able to get a better deal on the car than I had assumed, and partly it's because I do most of my charging at work, so my actual energy costs are dramatically lower than my model had anticipated.
Oh, and it's a very nice car, not a "tin can" that can't keep me as warm or cool as I like. It's a 3000-pound vehicle that accelerates 0-60 in 7.8 seconds, will do 90+ mph and can easily keep the cab at 60 degrees or 90 degrees or anywhere in between, regardless of outside temperature. It also has power everything, a nice stereo, GPS navigation, XM radio, bluetooth, backup camera, and computer or smartphone-based remote control... it's loaded. Of course, stomping on the gas pedal, driving 90 mph and blasting the heat (the AC doesn't use so much, plus it doesn't have to work against the heat generated by an ICE) will drop my range from 120 miles down to about 70 -- but my model only assumed a 60 mile range. It's a compact, but the alternatives I compared it against were also compacts.
EVs are very real, and very practical, today. And it's only going to get better. If Tesla can produce a $30K car with a 200-mile range, it'll be a huge hit with cost-conscious people, because that's enough range that for most people it can be a primary car -- no need for another ICE vehicle except on the rare long-distance trips, and it's cost-effective to rent for those.
Note to ACs: I usually delete AC replies without reading them. If you want to talk to me, log in.
I have read elsewhere that servicing the Model S means topping up the wiper fluid and rotating the tyres. Braking is done mostly with the driveline. Suspension generally lasts the life of a car these days. Electric motors are super reliable. Single speed gearboxes are reliable, like a differential gear. You basically build it and never touch it again.
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