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Elon Musk Bailed Out of $6bn Google Takeover To Save Tesla From 2013 Bankruptcy
An anonymous reader sends word that Elon Musk almost sold Tesla to Google in 2013 when the company was close to bankruptcy. "Elon Musk had a deal to sell his electric car company Tesla, to Google for $6bn (£4bn) when it was heading for bankruptcy with just two weeks' worth of cash left in the bank. During the first week of March 2013, Musk spoke to his friend Larry Page, chief executive of Google, about the search giant buying his car company, which at the time was suffering from falling sales amid technical problems with the few Model S luxury sedan cars it had delivered. Ashlee Vance, author of upcoming book Elon Musk: Tesla, SpaceX and the Quest for a Fantastic Future, claims in an extra for Bloomberg two people 'with direct knowledge of the deal' said Musk and Page agreed to the buyout and shook on a price of around $6bn. This was plus promises from Google to invest $5bn for factory expansion and to not break Tesla up or close it down."
Nevermind, I read "bailed out" to mean the company was saved by the sale, or the company was "bailed out," not that he opted out of the sale. I still think the headline could be more clear.
https://www.eff.org/https-everywhere
Yeah, the DoE got its loan repaid *in full*, *early*, and *with interest*, and the result was a successful American company providing employment and driving innovation with world-leading products, built in America, and paying US taxes. But according to the dimwit that wrote that article, because the DoE was in a position to bend Tesla over and fuck it in the ass, and they did not do that, that represents a "DISASTER" for taxpayers. Sometimes you just have to shake your head and move on.
As such, there is no reason to believe that they will not consider building their own cars. And if they were to do so, I am guessing that they will Work with Tesla to make their own.
There is a very good reason to believe they will not consider building their own cars. The reason is economics. Cars are a generally low margin business with huge capital requirements. The engineering and manufacturing are something Google has absolutely no expertise or advantage in. A VERY profitable large car manufacturer has profit margins around 8-10% (see Porsche or Toyota) and most are somewhere between 0-5% most of the time. Google right now has profit margins around 25%. If they got into the car business in any sort of meaningful way their profit margins would drop like a rock along with their share price. They would be jumping into a cutthroat business that they have zero advantage or experience in. Even if they bought a company like GM outright, it would be basically nothing but a huge distraction from their primary business. A company like Tesla they could manage because it is so small but eventually they would probably sell it off.
While Google has the financial means to get into the car business if they wanted to, they would be insane to do so. I could easily see them providing technology used in cars but I don't see any (sane) reason why they would actually want to make cars themselves.
I believe the China problem was that a lot of speculators bought a lot of cars hoping to make a killing. The resulting oversupply led to cancellations. It was badly managed.
On the issue of hydrogen fuel cells; they just don't make sense for many reasons:
- efficiency (they are less efficient than gasoline)
- distribution (they require special transport trucks... you can't use any existing distribution)
- hydrogen is made from fossil fuels so no benefit to the environment
- fueling (fuel stations cost several million dollars and have low capacity)
Electricity, OTOH, is ubiquitous. Electricity service is everywhere and the demand from electric cars is a rounding error on electric capacity. Plus, batteries and electric motors are much more efficient (90%) than internal combustion engines or fuel cells (30%).
I don't read your sig. Why are you reading mine?