How Does Musk's Government Funding Compare To Competitors?

Rei writes: We recently discussed an article in the LA Times complaining about how Elon Musk has built his corporate empires — Solar City, Tesla Motors and SpaceX — on the back of government subsidies. However, how does the funding compare in context to various competitors? USC professor Greg Autry breaks it down, noting among other things that SpaceX's competitors have benefited from decades of tremendous government money and a launch monopoly, while the Volt receives — on a percentage basis — 2 1/2 times greater subsidy than a Model S, and was developed on the government's dime.

Comments

Lies, Damn lies and Statistics

[jklovanc]

while the Volt receives — on a percentage basis — 2 1/2 times greater subsidy than a Model S, and was developed on the government's dime.

Maybe that is because a Model S costs 2.4 times that of a Volt. On a per vehicle basis they are almost the same.

Re:Lies, Damn lies and Statistics

[catchblue22]

The oil industry receives far larger subsidies per year than Musk is accused of receiving over three companies and many years. And some of the "subsidies" Musk is accused of receiving consisted of loans that were paid back with interest.

Pointless study

[phantomfive]

No one cares how he compares to competition. There are two broad groups of people on this:

1) People think it's fine for the government to subsidize some industry.
2) People who think the government should not subsidize industry.

The people in group #1 think it's good that the Tesla and Volt got government funding. The people in group #2 oppose funding of both Tesla and Volt. So a study like this will change no one's opinion (and from the author's writing, it is clear that is what he's trying to do).

Re:Pointless study

[cahuenga]

A Volt already starts at less than half the price Tesla S. I would suggest you go look at an S. Tesla's expense is not due to some idea of an infant technology, it's built like a luxury car.

Subsidies in the form of tax write-offs

[QuietLagoon]

If you really want to look at government subsidies, look at how much, or more correctly, how little huge companies pay in income taxes.

.
For instance, General Electric is always whining about taxes, yet pays a small percentage of revenue in taxes. It's an example of a corporation that is focused on taking, not giving.

So if you want to complain about excessive government subsidies, don't just look at one industry.

Article is Disingenuous, Author is Biased

[eepok]

You can read the whole article (and you should), but here are some nice excerpts.

FTA: On the electric car front, the Chevy Volt is the most significant U.S. competitor to Musk's Tesla Model S...

Meanwhile, Volt was developed during Uncle Sam's bailout of "Government Motors" with $30 billion. That's more than six times the number that got Mr. Hirsch so worked up! Though GM touts that they've "repaid" the government, Treasury reports that the government lost more than $11 billion on that dubious deal.

The Model S is not comparable to the Volt. The Volt is a plug-in hybrid (not an EV) cludge to meet the requirements of a bail out. The Nissan Leaf is a better comparison and it blows the Model S out of the water in its effects on the market. But, the author wants to hamstring a stronger comparison by requiring that the company be American.

Additionally, a bail out deal and subsidy are not comparable. A bail out deal your mom throwing you a few hundred bucks because your business failed, rent needs to be paid, and you have to go visit her to pick up the check. A subsidy is your mom throwing you a few hundred bucks to start up or expand your business. One's there to save your as with some nominal requirements and the other is there to help you profit. Musk has taken both for Tesla.

FTA: The most polite response I can offer to the critics is: Get over it. Find something more productive to do than condemning success. If you insist on continuing to carp, do your research first and hit the right targets. Otherwise you will continue to sound jealous and misinformed.

Wow, internet tough guy, huh?

Oh, and this isn't the only time this guy has white-knighted for Musk. He's actually a bit of a fanboy, so don't let his professorship lull you into a false sense of academic separation:

http://www.huffingtonpost.com/... "Disclosure: Dr. Autry currently owns Tesla stock."
https://twitter.com/gregwautry
https://www.facebook.com/gregw...
http://www.forbes.com/sites/re...

Re:Who Cares?

[Talderas]

There's a storyline going on right now.

Musk is frequently portrayed as a great symbol of free enterprise. Someone likely got sick of this and looked into how much government money Musk's companies were receiving. That in turn generated this particular response to point out the fraction of government money that Musk's companies received compared to competitors.

Seems pointless point to me. What am I missing?

[aussersterne]

The reason we use government funding to incentivize things is because we as a public want people to do/build/invent/fix those things and are willing to pay for that to happen.

So Elon Musk comes along and says he will and then he does. And then we pay him what, as a public, we planned to pay (via those incentives) to whoever did them.

Seems like everything is going according to plan, for all involved, and that we're lucky enough to have found something of a one-stop-shop for incentivized work that few others are willing to take on, but that seems to really move the needle on tech progress for something other than consumer electronics gadgets.

Win/win all around. Smells like right wing paranoia and demagoguery to me in here.

Re:Tesla isnt for everyday people

[rogoshen1]

well dude, in that case you're right, a tesla isn't for you. But your particular situation is absolutely (and I think you can even admit this) not the norm.

I like the volt as well, but it seems a bit sluggish, whereas the tesla looks like it would still be pretty fun to drive.

Re:Wipe your mouth, Slashdot

[turp182]

Musk is changing industries, big ones. From finance (Paypal, I know, it does suck, but alternatives are few and far between), solar, battery, electric cars, and space flight.

Jobs was a pioneer of computing but ended up a design specialist (good function and things like rounded corners).

I am a fanboy or no one. But I have to respect Musk as he doesn't talk about things, he does them. Richard Branson probably wishes he was Elon Musk...

I appreciate all of the Slashdot stories referring to Musk's activities. I don't actively seek out such information, but Slashdot provides it. And you certainly can't make an argument that the stories' topics aren't Slashdot fodder. Musk is a technical innovator of the highest standard, I don't believe anyone compares to him at this moment in time.

In conclusion, skip the story if you don't give a shit. That's what I do and I don't find myself needing to criticize or complain about story topics.

Re:Wipe your mouth, Slashdot

[Twinbee]

You're right. People aren't appreciative *enough* of him.

Let's see. Creates the best car ever, creates rockets for fun and as insurance to potentially save humanity by going to Mars, going to create rockets at least half the price as competitors, and potentially 100x cheaper, wants to save the Earth from CO2 and is beginning to do it, amazing engineer, helped create Paypal (when it was good), open-sourced patents, envisaged design for hyperloop, building the largest battery factory ever made by an order of magnitude or more, wanted to originally research supercaps (great area to study!), cares about quality rather than just money. Put every last penny he had at his own cost in order to save Tesla and SpaceX. Speaks frankly during interviews.

No one like him.