Tesla: The Government Gets Its Money Back
The tweet was true: As indicated on Tuesday, Tesla paid off its DOE loan on Wednesday. Nine years before the note was due, Tesla “wired $451.8 million to repay the full loan with interest,” as Reuters says.
The Obama administration has been massively criticized for its largesse towards Fisker Automotive, A123,and Solyndra. Both A123 and Solyndra filed for bankruptcy, Fisker is teetering on bankruptcy. The DOE is understandably effusive over the repatriated money, and Tesla. Said U.S. Energy Secretary Ernest Moniz.
“When you’re talking about cutting-edge clean energy technologies, not every investment will succeed – but today’s repayment is the latest indication that the Energy Department’s portfolio of more than 30 loans is delivering big results for the American economy while costing far less than anticipated.”
Moniz said more than 90 percent of the loan loss reserve Congress established remains intact, while losses represent about 2 percent of the overall $34 billion portfolio.
It’s not that Tesla suddenly made half a billion dollars to repay rich uncle Sam. Tesla used money from a $968 million stock and note sale that closed Wednesday to repay the debt. The TSLA stock has been on fire lately, Tesla has a higher market cap that Fiat, and it probably was a good time to issue more.
Executives of major automakers roll their eyes when Elon Musk talks about disrupting their business. Boutique makers of $100,000 cars sometimes do OK during an uptick of the economy, only to get wiped out when the economy goes sour and corrodes disposable income. The big challenge comes when boutiques enter the mass market and find themselves confronted with many billions of investments in R&D, plants, and marketing which won’t show profits for decades. Tesla has for all intents and purposes what little market there is for itself, especially after large OEMs cooled on the idea of EVs. Should EVs ever become a viable market, major OEMs can dust off their digital blueprints, slap an updated body on it, and disrupt the dreams of Tesla.
Bertel Schmitt comes back to journalism after taking a 35 year break in advertising and marketing. He ran and owned advertising agencies in Duesseldorf, Germany, and New York City. Volkswagen A.G. was Bertel's most important corporate account. Schmitt's advertising and marketing career touched many corners of the industry with a special focus on automotive products and services. Since 2004, he lives in Japan and China with his wife <a href="http://www.tomokoandbertel.com"> Tomoko </a>. Bertel Schmitt is a founding board member of the <a href="http://www.offshoresuperseries.com"> Offshore Super Series </a>, an American offshore powerboat racing organization. He is co-owner of the racing team Typhoon.
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- ToolGuy First picture: I realize that opinions vary on the height of modern trucks, but that entry door on the building is 80 inches tall and hits just below the headlights. Does anyone really believe this is reasonable?Second picture: I do not believe that is a good parking spot to be able to access the bed storage. More specifically, how do you plan to unload topsoil with the truck parked like that? Maybe you kids are taller than me.
- ToolGuy The other day I attempted to check the engine oil in one of my old embarrassing vehicles and I guess the red shop towel I used wasn't genuine Snap-on (lots of counterfeits floating around) plus my driveway isn't completely level and long story short, the engine seized 3 minutes later.No more used cars for me, and nothing but dealer service from here on in (the journalists were right).
- Doughboy Wow, Merc knocks it out of the park with their naming convention… again. /s
- Doughboy I’ve seen car bras before, but never car beards. ZZ Top would be proud.
- Bkojote Allright, actual person who knows trucks here, the article gets it a bit wrong.First off, the Maverick is not at all comparable to a Tacoma just because they're both Hybrids. Or lemme be blunt, the butch-est non-hybrid Maverick Tremor is suitable for 2/10 difficulty trails, a Trailhunter is for about 5/10 or maybe 6/10, just about the upper end of any stock vehicle you're buying from the factory. Aside from a Sasquatch Bronco or Rubicon Jeep Wrangler you're looking at something you're towing back if you want more capability (or perhaps something you /wish/ you were towing back.)Now, where the real world difference should play out is on the trail, where a lot of low speed crawling usually saps efficiency, especially when loaded to the gills. Real world MPG from a 4Runner is about 12-13mpg, So if this loaded-with-overlander-catalog Trailhunter is still pulling in the 20's - or even 18-19, that's a massive improvement.
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There is still something about Mr Musk I don't like or trust. I've never met him so I don't really know, it's just a feeling I have. Unfortunately that personal opinion reflects down to his cars, which I have never driven or actually seen in person. Doesn't really matter as I can't afford his cars anyway, nor do I see an electric car in my future given my current driving habits. So take this rather lame post with a grain of salt.
I fear for the day Elon Musk does make a mistake. Reminds me of that joke about the guy who built the school, built the road, Built the town hall. A hero in every sense except for that one unfortunate incident involving a goat... In Musk's case the goat is a Government loan.