By on October 20, 2014

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The Elio Motors project continues to generate skepticism. The latest is a post by Tavarish at Jalopnik’s CarBuying Kinja subsite giving us a half dozen reasons while the high mpg reverse trike will never come to be, Six Things That Could Kill Elio Motors Before It Even Launches. Tavarish isn’t the only skeptic. The consensus among automotive writers seems to be highly critical. While I enjoy being a contrarian and going against the stream I still don’t want to be a cheerleader for Paul Elio and his team, but I have to confess that there’s romance in the idea of someone starting their own car company. I also think that there is no reason short of raising enough money why they can’t put the car into production and meet their performance and safety specifications. I’m not so sure about Elio Motors meeting their $6,800 price point but I still don’t think the latest criticism is completely fair.


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First, I’m not naive. I recognize that the people at Elio have gone out of their way to cultivate good relations with this site and with me personally. A major reason for that is that unlike most of the skeptics, I’ve actually spoken with executives at Elio, including their head of manufacturing, their director of sales and Paul Elio himself. I’ve also corresponded directly with Stuart Lichter, a company backer who’s the middleman in the real estate deal for the former GM assembly plant in Shreveport, Louisiana. Everyone involved with the company has always answered all of my questions directly, with no evasions. Everything has been transparent, from my perspective at least.

A few weeks ago Elio’s PR guy contacted me with what he hyped as important news, the fact that Comau, the company that is supplying Elio with automation services at the Shreveport plant, will start selling off surplus machinery and equipment in the factory that wont be needed by Elio. I had a couple of questions about the financing of the equipment purchase and their rep gave me Paul Elio’s phone number, but the story didn’t really seem important enough to be of interest to our readers and I’m not simply going to run a press releasey post, so I didn’t call him at the time.

Since I do have a stake, as a writer, in the Elio story, I read Tavarish’s post with interest and I was disappointed that like many of the skeptics, he made a lot of speculation without checking either with the company or their suppliers. Having Mr. Elio’s number in my email in box, I texted him and asked when it would be a convenient time to call if he wanted to respond to the criticisms raised in the Jalopnik post. He called me and he answered the questions raised by Tavarish pretty much point by point.

Point one was that the Elio three wheeler is not a car, that legally it’s a motorcycle and that motorcycle helmet and licensing laws will hinder consumer acceptance. The Elio’s legal status as a motorcycle also means that it does not have to meet Federal Motor Vehicle Safety Standards, including passing crash testing, that automobiles and light trucks have to achieve. I didn’t ask Elio about the motorcycle laws that will affect drivers because the vehicle is what it is. The vast majority of states won’t require Elio drivers to wear helmets and 45 of 50 won’t require them for drivers over the age of 21. Forty five? That number sounds familiar. Oh, right, that’s the number of states where Tesla sells cars. If that’s enough Americans to launch a relatively niche luxury vehicle, it’s probably enough to launch something economical. We’ll return to Tesla later.

As for the car’s safety, Elio has claimed that it will meet NHTSA’s “five star” crash worthiness standards. Tavarish is skeptical because motorcycles don’t even have to be crash tested. In my most recent post on the Elio three wheeler, when I got to drive the prototype, something almost none of the skeptics have done, I asked Paul Elio about crash testing and he said that it was possible, perhaps likely, that because of the vehicle’s status as a motorcycle that NHTSA won’t crash test it. He said that if that transpires, the company will have private firm put the trike through identical testing and that they will publish the results.

Tavarish’s second point also has to do with the fact that it’s a motorcycle. Elio Motors has been promoting their vehicle as environmentally friendly, based on it’s projected 84 mpg on the highway. Tavarish points out that Elio doesn’t talk much about the emissions side of being green and he’s skeptical of Elio’s claims that the vehicle will pass California’s stringent pollution testing, figuring that motorcycles have to meet their own standards in California, that Elio will use that loophole to avoid equipping their trike with “all that messy and expensive emissions equipment, like evaporative emissions canisters, exhaust gas recirculation, and even the staple of cleaner air technology in cars – the catalytic converter.”

Paul Elio told me that Johnson Matthey, who supply about a third of the catalytic converters currently being installed by auto manufacturers worldwide, will be supplying them with the catalytic part of the pollution control device. Eastern Catalytic will be “canning” the converter and supplying the rest of the vehicle’s exhaust system. The Elio 0.9 liter three cylinder, designed by IAV, will feature EGR and variable valve timing as part of its emissions package.  The fuel tank, fuel pressure lines, and returns will be supplied by ABC Fuel Systems will be compliant with automotive standards for evaporative emissions.

Tavarish makes much about the fact that that pollution equipment is proposed for an engine that does not yet exist. All of the prototypes so far have used the Suzuki triples out of Geo Metros. In August, when I last spoke with Paul Elio, he told me that the major engine components for the first prototype had been cast and that it would take a couple of months to get all  the parts in and everything machined before they’d be able to put it together. According to Elio, he current status of the prototype engine is that it’s been assembled and spun without power to make sure there are no interferences. It was then torn down and it is currently being reassembled in a more laborious process that involves checking all tolerances, torques etc. The target date for dyno testing is November 15th. Elio told me that assuming they meet power and torque specs they will run the engine to failure. Following that, 25 validation examples of the engine will be built for pre-production pilot vehicles, some of which will be used for crash testing.

I’d like to point out that with today’s digital tools, engine design is not as hit or miss (no pun intended) as it once was. The use of modeling and simulation software means that if it works in the digital domain it will almost certainly work when made out of metal. Ecomotors, the engine startup (again, no pun intended), has skipped actually building some generations of the prototype design because it was a waste of time just to make sure they worked.

Of Tavarish’s six reasons, the next one is the strongest, whether or not the company has enough money to get to production. Tavarish cites Jo Borras‘ calculation that they’ll need about $200 million to pull it off. While Borras has been one of the most outspoken skeptics, Paul Elio told me that Borras’ figure (and he mentioned him by name) was probably accurate. When I asked him where the money will come from, he said “a variety of funding sources”. Some of the money will come from customer reservations, which are currently at just over 35,000 and increasing at about 6,500 a month. Current investors, whom Elio says are very happy with how things are going, will also be asked to pony up additional capital. Another source of capital will be from selling off unneeded machinery in Shreveport. The reason why they were hyping the surplus machinery and equipment sale was that they now hope to clear between 30 and 40 million dollars from those sales, a big fraction of the money they need.

The equipment to be sold was purchased by Elio Motors from the RACER trust with $26 million in financing. Elio volunteered that he “overpaid a little but not a lot”. At first the plan was to sell it at auction but manufacturing has picked up a bit in the U.S. and machinery prices have gone up. So much so that the auction idea has been killed and now Comau will be going through all of the equipment, testing it to make sure it works and preparing it for individual sale. This way they can ask a higher price than if the machinery was sold covered with dust at a one day auction. Comau will be both selling the gear on the open market and using it to offer their worldwide automation customers an economical alternative to new machinery.

When all that is sold, Elio says that there still will be hundreds of millions of dollars worth of plant equipment that they will be using. Buying a recently closed auto assembly plant can be a good deal. That factory was building midsize pickups not very long ago. The plant is fairly modern and includes an EPA compliant paint shop, perhaps the most expensive part of a modern car factory because it is robot intensive and must comply with air pollution regulations.

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Elio engine mockup. Full gallery here

Elio isn’t certain that they’ll meet their financial objectives and lots of car company startups never got off the ground but he’s optimistic. “What we’re doing is hard, ” Elio told TTAC, “but it’s well thought out and we have the right people and suppliers”.

One hint of where they may get funds has to do with geography. Elio’s headquarters is in suburban Detroit and Paul Elio and his team are based near Phoenix, Arizona, but he called me from Washington D.C. It interesting that he’s in the nation’s capitol just days after the Department of Energy said that it will be restarting the Advanced Technology Vehicle Manufacturing loan program. Only about $10 billion of the $25 billion that was allocated was loaned out before the program was put on hiatus in the wake of the failure of Fisker Automotive, which received over half a billion in ATVM money. After the bankruptcy sale of Fisker assets, the DoE lost about $139 milion on the loan. Though the Elio trike doesn’t really use any alternative technologies, it is supposed to be fuel efficient and while the usually reliable David Shepardson of the Detroit News reports that most of the new loans will go to suppliers, I’m guessing that Elio Motors may apply for an ATVM loan.

The Kinja post also takes issue with how Elio is promoting itself and its proposed product. Tavarish says that the company doesn’t have a clear idea who will be their customer and that their promotional videos are lame. Elio conceded to me that they have a very limited advertising budget.  The particular video was shot two years ago, with the P2 prototype (TTAC tested P4), and while there are videos of the current prototype, produced both by Elio and by media outlets, including TTAC, most of the marketing effort is focused in three directions. There is an ongoing road show, taking the prototype(s) to events around the country that attract large crowds and those displays are usually coordinated with some kind of local or network news coverage, but most of the promotional effort is placed online.

Tavarish concentrates on the fact that Elio is at least in part promoting their trike as an “and” car, a second or third car devoted to commuting. In addition to making an obligatory comment about the typical Elio driver lacking female companionship (and, hey, I made a similar joke but actually at the Woodward Dream Cruise stop on the road show the truth is that it seemed to me that as many women were interested as men) he lists the aspects of the car and of potential Elio buyers in a manner that shows that there just aren’t many folks who will be in the target market, someone who can afford a quirky second or third car but who is also cheap enough to be attracted by the low price and great fuel economy. That may be true but there aren’t that many people who fit the stereotype of the characters on Big Bang Theory but the show’s popular enough to be in syndication. Tavarish does concede that the little three wheeler is”likable”.

The marketing strategy that Tavarish compared to throwing spaghetti on the wall and seeing what sticks may be a bit more focused than that. While the road show exposes the Elio to whomever randomly happens to walk buy at a big event, the online marketing looks to me to be indeed focused, albeit on people who might already show an interest in the tandem reverse trike. At least based on how the ads in my browser are acting, Elio is spending money on online ads targeted at people who have either visited the Elio website or used the name on a search engine. I’m not sure exactly how it’s done, but online advertisers have a way of aiming their ads that are the result of a little spying on us. I’m working on an idea for a musical instrument so now I see a lot of ads for Guitar Center. Back when I reviewed a Jaguar, my browser would display ads for that brand. Before today I hadn’t been at the Elio website or put the name in a search engine since August and I was still getting ads for the Elio trike when I’d go online. By some measures, the marketing is working. Paul Elio told me that the Elio Motors website is getting about 550,000 visitors a month, which he claims is more than a bunch of established automakers’ websites get.

Tavarish’s final point is that the Elio trike is not a gamechanger. As an example of a gamechanger, he cites the Ford Fusion Tesla Model S. I’m not sure why it makes sense to compare the Elio to a luxury EV that costs more than ten times its price. Nobody’s going to crossshop a Tesla and an Elio, though I’m guessing that since a lot of Teslas are also used as “and” cars, they’re not the only vehicle owned by those families. Considering that for affluent Tesla owners, who are the definition of early adopters, the relatively low MSRP of the Elio has the nature of an impulse purchase, Tesla owners may actually consider an Elio as a third or fourth car.

Tesla does happen to be relevant to Elio, if not as a competitor than as a role model. Elio is planning on selling their cars through company owned stores (and have them serviced at Pep Boys), as Tesla does. Paul Elio told me that besides the 45 states that allow direct manufacturer car sales, of the five states that have strong dealer franchise laws, they think they can use their status as a motorcycle maker to get around those laws in three of those jurisdictions and that they’ll be piggybacking (my term, not his) on Tesla’s lobbying and legal efforts in the remaining two states.

I’ve said it before, going forward, everything that Elio has to do to get to production is out in the open. The engine will either run on the dyno or it won’t. The 25 preproduction cars will be built or they won’t. I’ve also said, all along, that there is ample reason for the Elio critics’ skepticism, but so far the automotive startup keeps meeting their objectives, albeit in a delayed manner. As long as they keep meeting those objectives, I’ll keep a fair and open mind about the Elio enterprise.

Ronnie Schreiber edits Cars In Depth, a realistic perspective on cars & car culture and the original 3D car site. If you found this post worthwhile, you can get a parallax view at Cars In Depth. If the 3D thing freaks you out, don’t worry, all the photo and video players in use at the site have mono options. Thanks for reading – RJS

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66 Comments on “Paul Elio Responds to Skeptics...”


  • avatar
    stevelovescars

    I’m not sure where Tavarish got his info about motorcycles not requiring any emissions equipment. Motorcycles in California have required evaporative emissions cannisters for many years and many even have catalytic converters. Yes, some customers toss these heavy pieces in the trash bin after getting their bikes home, but not all motorcycle owners are hooligans and the engineering works.

    As for the motorcycle designation, there are other examples of this. The electric Corbin Sparrow was also an enclosed (1-seat) three-wheeled motorcycle and I don’t believe one needed a motorcycle endorsement nor a helmet to operate it legally, even in California which has helmet laws. The Aptera, another three wheeled electric “motorcycle” (which sadly never made it to market) also got around the endorsement and helmet rules.

    Not to say that this car is going to make it to market, there are a ton of other issues, as the article mentions. But I do wonder how many of his other facts came from his own pants?

    • 0 avatar
      Rod Panhard

      You’re correct Stevelovescars. Not only does California have emissions rules for motorcycles, the USDOT has rules for all motorcycles and scooters, and has for a very long time. Here’s a hint: Go find a new two-stroke motorcycle for sale.

      I don’t know or care who this “Tavarish” character is. I really don’t. What does bother me is how bloggers get quoted again and again, as if they know what they heck they’re talking about. Meanwhile, young editorial types end up responding to them.

      I’m pretty sure it’s easy to get caught up in it. But really, we need to start calling it like it is. Somebody has to throw the bull shostakovITch flag. And today, it looks like it’s Mr. Schreiber. So thanks!

      • 0 avatar
        Hummer

        Local dealer has several two strokes for sale. They sell very well from what I hear.

        Off the top of my head Suzuki, Kawasaki, and KTM all offer 2 strokes. Being that they’re lighter, cheaper, and functionally twice as powerful per cc than a 4 stroke, as long your not afraid to turn wrenches, there’s no good argument for using a 4 stroke equivalent for off-roading at least.

        • 0 avatar
          TW5

          Off-road?

          • 0 avatar
            Hummer

            I was hoping this would be the response, or something similar.

            I actually was looking into the process to put a two stroke on the road, from listening to others, it’s a really simple process, a 250 KTM is functionally similar to a 500cc roadable bike, so putting a larger charging system, lights, and getting tags isn’t hard, at least in NC.
            The only drawback that makes it an iffy proposition is the inherent design of a two stroke, your gonna put her through crap if you try and stay a constant RPM for a good length of time. So the top end is the limiting factor in the problem, though simple around town trips shouldn’t be any issue.

          • 0 avatar
            TW5

            so they don’t sell any street-legal 2-stroke models?

          • 0 avatar
            Hummer

            I’m not entirely sure the answer is completely no, because I’ve come across some extremely stock looking 2- strokes by several makes with lights and tag mounts. And being I haven’t actually asked a dealership the question, I’m not fully sure.

    • 0 avatar
      bk_moto

      I came here to say this as well. You’d be hard-pressed to find a modern motorcycle (excluding off-road-only dirt bikes with no lights etc) without electronic fuel injection with lambda control, catalytic converter(s), charcoal canisters, and all the other emissions controls that you’ll find on automotive engines.

      I suspect that the EPA standards for motorcycle emissions are not quite as stringent as those for cars but they are there even if they’re a few years behind the automotive world (I’m not aware of any gasoline direct injection motorcycle engines yet).

      If there were no emissions rules for motorcycles you’d probably still be able to get road-going mosquito foggers like the 2-stroke Kawasaki H2 from the ’70s and Triumph would probably not have switched their modern classic engines from Keihin carbs to fuel injection back in 2008. Nor would BMW have bothered to partially liquid-cool their iconic boxer engine.

      • 0 avatar
        Brian P

        The US EPA standards for motorcycles are quite outdated. Even the California standards are outdated with the exception of the charcoal-canister requirement. For most motorcycles these days that are built for worldwide sale, the European standards are the governing factor. Most are fuel injection – O2 sensor – three-way catalyst nowadays.

    • 0 avatar
      carve

      With the advent of direct injection, what’s stopping us from going back to two strokes? With DI, no unburned fuel would be pushed out the exhaust port upon intake.

      • 0 avatar
        Brian P

        There is still the problem of some lubricating oil going out the ports. The piston rings still need lubrication, and when the piston rings cross the ports, some oil is going to go in through the combustion chamber (doesn’t burn as well as gasoline) and some of it will go out the exhaust port (catalysts may not like that).

        It’s a much smaller issue than with the old carbureted engines running pre-mix … but it’s too much of an issue to pass modern emission standards.

        • 0 avatar
          carve

          Good point- thanks, Brian. Aren’t some diesels 2-stroke? I suppose they get around it by trucks having no emissions controls at all until recently, eh?

          • 0 avatar
            bumpy ii

            Yep, the classic Detroit Diesel and EMD engines are 2-stroke, and emissions standards mean they are finished at the end of this year.

          • 0 avatar
            dal20402

            Thank god. The “screamers” are awful engines from a drivability standpoint, as well as an emissions one.

          • 0 avatar
            JustPassinThru

            A two-stroke diesel is far different from a two-stroke gasoline engine.

            A two-stroke diesel has an oil sump and forced lubrication. The crankcase plays no part in the compression cycle – a Roots blower or turbocharger with mechanical startup on cranking, provides the pressure to feed the fuel charge.

            So emissions wise, a two-stroke diesel is much closer to a four-stroke. That said…they are dirtier; and yes, the Detroit Diesel two-stroke is dead; the EMD/GM Diesel Canada design for diesel locomotives is going away.

  • avatar

    >>>Since I do have a stake, as a writer, in the Elio story, I read Tavarish’s post with interest and I was disappointed that like many of the skeptics, he made a lot of speculation without checking either with the company or their suppliers.

    A lot of people are tribal about everything, from politics to cars.

    I like this thing because it would make automobility that much more affordable to a lot of people who lack access to anything but totally unreliable beaters.

  • avatar
    zamoti

    Tavarish writes interesting tales of buying depreciated luxury cars, but I would not consider him an authoritative source of real information.
    The problem with infotainment sites such as Jalopnik is that for some odd reason, people believe that they are staffed by journalists and adhere to some form of reporting standard, where in reality these sites are just blogs which means that they can “print” whatever the hell they want and face no real critictism.
    If people are reading Jalop or any Gawker web property and expecting news, they probably also consider to be “real” news.
    Though I don’t really take much interesting the Elio product, I do appreciate it when someone picks up the phone and talks to another person to get the real story instead of just creating an opinion piece with a touch of real news rolled in, and presenting it as fact.
    In other words, good show.

  • avatar
    Brian P

    Can they get this vehicle to the point where they can build it, I would say “yes”.

    Can it be done at the price point that they stated, and will it return the fuel consumption that they’ve constantly repeated – well, will it be 84 mpg US EPA highway? Or downhill with following wind?? And can it sustain the sales volume that their financial position is based on, which is in the range of top-selling mid-size sedans? Those are where I have doubts.

  • avatar
    DC Bruce

    Elio might want to break out the total operating cost of a commuter vehicle (i.e. one that’s not driven long distances). I think he’ll find that fuel is among the smaller cost components (and, for the moment, is headed down anyway). Larger cost components are depreciation, insurance and repair/maintenance. And he also ought to calculate the dollar savings for a vehicle driven 10,000 miles/year between one that gets 40 mpg and one that gets 60 (or 80).

    The Smart For2 doesn’t sell particularly well. It has “good enough” fuel economy but is just a fail as a car: doesn’t operate well, carries only one passenger and almost no stuff. So, that’s his competition, in my opinion.

    And, if this things are launched and people start dying or getting seriously injured in crashes that “would be survivable” in a vehicle that meets car standards, you can bet that car standards will be applied to it. Just like some semblance of car standards eventually were applied to SUVs after early versions were essentially regulation-free.

    Building a business that depends upon the continued existence of a regulatory loophole strikes me as pretty risky.

    • 0 avatar
      benders

      Not a good comparison. The fortwo is ~$13k which is damned close to Fiesta/Yaris/Spark/Versa territory. No real penalty in fuel economy going to those cars either.

      The Elio has a much lower price and a big hook in the advertised mpg.

    • 0 avatar
      rentonben

      Riding in the carpool lane (and the time savings) is the big attraction for me of this vehicle.

      • 0 avatar
        DeadWeight

        You’re obviously in WA State, and let me just state that every single state in the nation should have HOV lanes like WA, where the left HOV lane is only accessible to vehicles with at least a passenger.

        WA traffic wasn’t that bad, but at rush hour, it was bliss to be able to zip by slow moving traffic in the HOV lane.

  • avatar
    Pch101

    Except for the emissions comment, he’s right. It’s neither fish nor fowl, so there won’t be much demand for it. And a startup like this is doomed to run out of cash.

    If there was a sustainable market for this kind of thing, then a major motorcycle or automotive producer would already be doing it. The concept itself is not that radical or innovative — Honda could build this thing in its sleep — but there are good reasons not to bother.

    • 0 avatar
      TW5

      They don’t have a good reason. They have myopic investors and board members who want the company to further exploit the established system of ripping-off consumers via options-bundling, funded with subprime auto loans. Without the bailout, including the backdoor DOE bailout of Ford, we wouldn’t have any American auto manufacturers remaining. The market has spoken, these people are idiots. Since the Japanese and Germans play the same general game, they are just financially savvy idiots.

      Every year consumptive oil imports top $200B, which makes US-earned profits increasingly worthless. Every year more people panic about climate change. Still, they can’t figure out how to get America’s oil consumption problem under control. CAFE 2025 is just around the corner, only Toyota have demonstrated their ability to sell hybrids. The same manufacturer also has an Atkinson engine portfolio that may save the affordable ICE car. Everyone else?

      In general, the automobile manufacturers are utterly hopeless when it comes to managing the macroeconomics of their industry. They are more interested in the oligopoly signalling games the play with one another, and virtually oblivious to the world around them. They could learn a lot from companies like Elio and Tesla. They could learn a lot from the smaller manufacturers who live on their discarded ideas, like Subaru building an empire on the gravesite of the AMC Eagle/Spirit.

      • 0 avatar
        Pch101

        Must you insist on seeing a conspiracy?

        Occam’s Razor makes for a quick shave:

        -Guy has a dream
        -Dream isn’t realistic
        -Dream will probably bite him in the a**

        It happens. People tend to lionize the few guys with an oddball vision who managed to succeed. We want to be like them.

        They never read about the many, many more whose dreams fail to materialize, because we almost never hear about those whose dreams fizzle out.

  • avatar
    FormerFF

    I’m very skeptical that they can make that price point, using middleweight motorcycles as a basis for comparison. I’m also skeptical that the driving experience, especially from a noise, vibration, and harshness standpoint, will be good enough to satisfy most potential buyers.

    • 0 avatar
      benders

      My first thought was to agree with you but now I’m not so sure. Compare big touring bikes to mid-size sedans and you get dramatically different vehicles for the same cost.

      I’m struggling to define exactly what the root cause for this is though.

  • avatar
    mnm4ever

    I think the key to this car is a combination of the low purchase cost and extremely high fuel economy. Comparing it to a used car at the same price point isn’t really valid… $7k doesn’t buy you much of a used car these days. And it will never get you a car that can equal the 80mpg rating. Comparing it to other small “commuter” cars like the ForTwo or the Mirage isn’t really valid either as those cars new cost nearly double the price and get half the fuel mileage. Comparing to lower priced electric cars is similarly problematic… the range of the electric is too short for many commuters and the price is much higher.

    This car is aimed squarely at me. I commute about 35-40 miles one way, sometimes as much as 50 miles to some clients. Round trip its too far for an electric except for the Tesla, and I don’t want to spend $80k+ on one of those. I don’t want to buy a normal fuel efficient car either, I like V8s and trucks. My future planned car purchases will average 20-22mpg tops (Mustang GT and pickup truck for towing the boat). Commuting 80-100 miles a day in a truck will cost me close to $300/mo in fuel. Commuting the same amount in an Elio will cost me around $70/mo in fuel. An Elio payment will be well under $200/mo depending on length of financing. By this math I would essentially save enough in fuel to cover the cost of the Elio. And more to the point, it also frees me to own and drive the less fuel efficient cars that I want while still having a brand new car to use for commuting and saving wear and tear on my other cars.

    Sure I could give up the V8… I used to have a GTI which was a fine compromise car, but with an Elio I don’t have to. I could also buy a used commuter car, but that isn’t going to save me much on fuel and I don’t need anything more practical than the Elio as I have 2 other cars already, not to mention it would be used and have possibly more maintenance issues. I think there are plenty of people who commute long enough distances to make this a viable product. Just in DC alone they could probably sell enough to dedicate a highway lane to Elios. Of course if Elio doesn’t hit both the price and economy targets, my entire argument is invalid.

    • 0 avatar
      jhefner

      “Just in DC alone they could probably sell enough to dedicate a highway lane to Elios. Of course if Elio doesn’t hit both the price and economy targets, my entire argument is invalid.”

      My guess is these will be able to use the HOV lanes in many jurisdictions; another plus for owning one.

    • 0 avatar
      bosozoku

      >$7k doesn’t buy you much of a used car these days

      I’d argue that it buys a helluva lot of used car. Plug that number into craigslist and you’ll find a range of much better options than the Elio in every respect save raw efficiency and novelty.

      • 0 avatar
        mnm4ever

        efficiency and age. What you find at that price point will have well over 50k miles, and in some areas closer to 100k. And nothing at that price will get close to 80mpg, which is really the main point. This isn’t going to replace the Camry, new or used. This isn’t going to be someone’s only car either. This is car to suit my needs perfectly, and my argument is there are a lot of people in a similar situation as me.

        I have a team of coworkers who basically drive every day, alone, from client site to client site. We get reimbursed about $0.50/mile and most of them average around 1000 miles a month plus commuting and personal usage. Driving an Elio will be more than just free, they will make a profit by using something like that instead of a truck or even a fairly efficient car. Hell now that I think about it, my company would be better off buying a fleet of them and letting us have them as company cars instead of paying out the 50 cents/mile. There is a whole other market for them.

  • avatar
    87 Morgan

    I want this to work. For many a fuel efficient enclosed vehicle with a price point below sled level used cars is promising. But when one considers one of the many Camrys that come out of rental service every year and can be had for less than or equal to 15k, albeit double the Elios entry point, it is hard to conceive why one would consider this thing. I am sure financing will be made available, insurance as well. But will the rates be comparable to the afore mentioned used Camry. Next is long term ownership, resale etc. Their are many options available to the cost conscious public for affordable transportation that provide the user with at least a fighting chance if they are involved in any event greater than a low impact fender bender.

    I like the point made about the Smart for two. That car is just awful in all respects other than parking in an urban environment. If the Elio delivers a similar experience, it is doomed.

  • avatar
    TW5

    Start-up companies have enough going against them. Inventing imaginary problems with the product is unnecessary. The legitimate sources of skepticism are the capital funding, the safety aspects, and the ability to hit 84mpg for just $6,800 MSRP.

    We spend much of our time slagging conventional cars that sell over 100,000 units per year. People will never buy a poorly-styled, compromised vehicle? Really? The person who made these claims identifies himself as an auto blogger? I see poorly-styled compromised vehicles everywhere, and people spend over $20K a pop.

    We’ll see where Elio goes. The business model appears to satisfy customers, suppliers and investors. The product has a sort of democratizing charm, like the original VW Beetle. Elio is probably 50/50 odds, which is better than most people who dream of running a vehicle manufacturing company.

  • avatar
    Crabspirits

    Another snag I don’t see mentioned is that people will need a motorcycle driver’s license to operate these things. You need to take the test with, guess what, a motorcycle. Something tells me this thing won’t fly if you try to take the test in it.

    It can fail from that hassle alone.

    • 0 avatar
      stevelovescars

      Nope, it appears that in some states a three-wheeled “car” like this is exempt from the need for a motorcycle endorsement. Here is one example (WA state) I just googled in less than 1 minute:

      http://www.dol.wa.gov/driverslicense/gettrike.html

      I was wondering how cars like the Aptera were exempt from this requirement, so I guess they really were.

      • 0 avatar
        mnm4ever

        I am not even sure you NEED to have a motorcycle endorsement to ride one in most states. In FL that is only required if you are under 18. It might be “suggested” but I don’t think they give tickets for it.

      • 0 avatar

        Here in Washington my HMV Freeway must be licensed as a motorcycle but I need neither a helmet nor an endorsement to operate it. From what I’ve seen of the Elio from sitting in a prototype, it would fall into the same category.

  • avatar
    honda_lawn_art

    If gas were to ever go above $5.00/gallon in the US again, this would be a totally different conversation, but that doesn’t seem likely in the near future and investors know that.
    There still may be a business case yet, but I’m having trouble seeing a market as large as what would be needed.

    • 0 avatar
      VoGo

      Let’s do some math, shall we?

      Suppose that you have a car today that gets 25MPG, which is about average. And you drive 15K miles/year and gas costs $3.50 per gallon. You are spending $2,100 annually on gas.

      Then, you go out and buy an Elio, and drive it 10K miles/year, but still keep your old car, and continue to drive it 5K miles/year. Those 5K miles cost you $700 (one-third of the $2,100 you used to spend) for gas. At 70MPG, the Elio costs you $500 for gas each year, and let’s say depreciation of purchase price and interest cost you $900/annually.

      Combined, those costs are $2,100 annually, which was what you were paying just for the sedan’s gas previously. So you are at breakeven, financially. Which means that if you enjoy driving the Elio, and have room for it, then why not?

      • 0 avatar
        mnm4ever

        +1 @vogo

        That is also not accounting for the reduced wear and tear on your normal car, reduced maintenance, possible insurance savings by not using your regular car for commuting, or as I said before, simply opening up options for you to be able to now buy a regular car that doesn’t have to be good for commuting, like full size trucks, sports cars, muscle cars, classics, etc. You could accomplish a similar mission buy buying a Prius, but thats a $25k+ car and still tops out at 50mpg or so. If they meet their targets this will be a much more affordable option. Depreciation is even a soft cost, in that it only matters if you are counting on selling it. At this price point you can afford to keep it a decade or longer, just droning along filling the daily driver role at nearly no cost once it is paid off. You would think enthusiasts would really be going gaga over this thing.

        @honda — Yea I am sure gas prices will never go back up. :)

      • 0 avatar
        baconator

        +1 on this. There are so many households where one driver is doing the cargo (and/or kid) schlepping, and the other person has a long commute to a job. Two cars needed, but not a big enough budget for two >$10k cars.

        This thing will also be catnip to 20- and 30-somethings in urban areas. If they’re even plausibly reliable and screwed together at least as well as a Smart ForTwo or Fiat 500, I’m pretty sure I could sell 20 of them just to people I know. There’s *definitely* demand for this thing. The question is whether Elio Motors can execute.

        • 0 avatar
          Pch101

          The car fails what I will call the Driveway Test. Very few people would want to be seen with this by their neighbors, because it isn’t a “real” car.

          If something like this made sense, then a company like Honda would already be making it.

  • avatar
    SCE to AUX

    The technology, safety, emissions, fuel economy, and company financing are all pretty irrelevant to me.

    What really matters to me is this: That thing is really goofy-looking. Nobody is going to buy a 3-wheeled car with outriggers – 2 major failures.

    If it has outriggers, I want it to fly.

    Tesla has set the standard for how a modern car company can start up and succeed – you absolutely MUST offer a distinctive, appealing product. “Distinctive” in the quirky sense isn’t appealing, and its performance/economy is middle-pack at best. Only the mythical low price is appealing, but has yet to be realized.

    • 0 avatar

      The ideal market for this car is not the TTAC reader. The ideal market is people making in the high teens or 20s annually. There are a lot of people who could afford this as a new car, who are currently stuck with beaters. (People who essentially lack resources are not as likely to have the resources to figure out which used cars are likely to last the longest, for the least $, etc.

  • avatar
    PRNDLOL

    Memories of Liz… :winK:

    http://en.wikipedia.org/wiki/Liz_Carmichael

  • avatar
    petezeiss

    I can’t be the only one who watched Ronnie’s video with headphones/earbuds in place. Death blow.

    We I was young we had a ’63 VW in the family. The Elio makes its NVH seem like an LS400’s.

    Plus, I have some cargo shorts with more storage space.

    • 0 avatar
      Steve65

      Probably not, but you may be the only one who thinks an engineering development mule can be evaluated as though it is a market-ready production car. They don’t even have their own engine in it yet. NVH (and suspension tuning) are things polished up in the final development stages. It’s way premature to be commenting on them.

      • 0 avatar
        petezeiss

        Oh, good. Then it’ll be serene and maybe even have room for a normal load of groceries. And get 84 mpg, be safe on the road among all the 5500 lb. pickups and only cost $6800.

        So glad to be wrong.

        • 0 avatar
          mcs

          >> be safe on the road among all the 5500 lb. pickups

          Probably as safe among 5500 lb pickups as the 5500 lb pickups are safe among all the 26,000+ lb semi trucks.

          • 0 avatar
            rpn453

            Probably not. There are far more pickups on the road, and they’re typically driven more aggressively and negligently, by less qualified drivers.

          • 0 avatar
            mcs

            >> Probably not. There are far more pickups o

            Depends on where you drive and where you live. Close to my home, we have narrow roads and face semi-truck dump trucks. One took out a suburban a few years ago. I posted my previous comment after driving 495 west of Boston. Many more large trucks than pickups and lots of bad behavior and accidents involving large trucks.

          • 0 avatar
            rpn453

            I suppose it does. I must see 20 pickups for every semi in my city, and I can’t think of a single time that I’ve seen any sort of large truck driving negligently.

  • avatar
    carve

    Due to the aerodynamics and light weight, this seems like it’d make a great EV as you could get by with a pretty small battery.

    I think it’d also be a great place for a direct-injection two stroke. Why don’t we use those? They don’t have the smokey, unburned fuel problem of old fashion two strokes, and it’d be much lighter weight and cheaper to build.

  • avatar
    taxman100

    I’m married and have two kids. Wife stays home and drives a minivan. I have a 2000 Corolla with 184,000 miles that I’m hoping to replace with an Elio. I have not put any money down, as I’m waiting for the factory to be set up first.

    I drive 36 miles round trip to the office, and for commuting and running to the grocery, etc., it would be perfect. I’d pay cash, and be out of the automobile market for what I hope is another 16 years, and 200,000 miles.

    • 0 avatar
      Hummer

      You sound completely unknowing of potentially hating the vehicle.

      I have all the hope in the world this will succeed, but we’re already talking 200k miles and 16 years? Slow down, one step at a time, this is a start up they may succeed in getting everything out and right but they don’t have the money other automakers have to ensure a products long term life. Tesla should be proof enough of that, they have much better funding and still have a few issues to iron out.

  • avatar
    oldyak

    Thanks for the update!

  • avatar
    AFX

    The biggest thing to me with this car is the propietary engine being built for it. They should have engineered the car around an existing off-the-shelf engine already available from a current motorcycle or car manufacturer. Instead they’re making a totally new untested engine from scratch to use in this car. There’s absolutely no real world durability testing on the engine as of now, and people are putting down money on this thing. It just doesn’t make any sense from a business or buyer’s standpoint. Nobody knows if this thing will be a dog or not, for all we know it could wind up like the Vega engine, or many other engines that have been made and recalled by major manufacturers over the years due to poor design or engineering. What happens if Elio does go belly-up after it’s been selling cars for awhile. Since the engine is a proprietary design it’s not like you’ll be able to run to Autozone or NAPA for parts for it to keep it on the road if Elio goes bankrupt. You’d have to buy a spare Elio parts car just to keep one on the road if that were to happen. Designing their own engine was just a dumb idea.

  • avatar
    tedward

    What’s going to be hilarious if this succeeds is the mad scramble to sell “third cars” by the mainstream brands that it will interfere with. The EV’s are coming, a lot are already here, and every company selling them seems willing to loose a ton of money moving them to get those fleet credits.

    EV mandates (and other similar idiocies, cough, rear view, cough) are why we can’t have nice and inexpensive things.

  • avatar

    Elio’s struggle to gain acceptance is not exceptional, it is Tesla that forms the remarkable exception to the rule. Musk managed to set in motion an ongoing process of publicity, finding people interested in investing in the company and building cars that appeal to a discerning clientele. What started out as wishful thinking to a lot of people became a self-fulfilling vision. Let me put it this way: if Musk had launched Elio Motors, it would have been the stock markets’ darling too. Then again, knowing Musk’s vision on the car business, he wouldn’t have.

    Although on paper Elio’s three-wheeler makes perfect sense, it may well fall through the cracks as an alternative to the small hatchback, simply because it is not that practical, nor that safe.

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