4 ms·

Shame, Rivian won't get the DOE loans that helped Tesla stay afloat.

by gigatexal 4y ago

bryanlarsen 4y ago
Tesla received $465 million in DOE loans, which it paid back. Rivian is going to need deeper pockets than that.
- HWR_14 4y ago
  > Tesla received $465 million in DOE loans, which it paid back. Why is "they paid the loan back" always a talking point?
  - HorizonXP 4y ago
    Why is needing the DOE loan always a talking point? It is not a sin to enlist the help of others to achieve your goals.
    - lazide 4y ago
      A lot of people get angry when the money came from the gov’t (aka their taxes) without their permission to help someone who has more money than them.
      - HorizonXP 4y ago
        I know it’s a lot to ask of the general populace, but self-reflection is key here. I’m smart and confident. But I know that I would be a terrible person to give a $465m loan to. Money is our economy’s way of rewarding those of us with outsized skills. It’s far from perfect, but it’s the best we’ve got. Is Tesla and Elon the best place to put that $465m? Maybe, maybe not. But it was the best we had at the time, and I certainly don’t see anyone better than him now.
        lazide 4y ago
        That is indeed a lot to ask of the general populace. But I don’t think even a majority of the populace had an issue with it anyway - it’s always the fringe extremists that get most of the press, they tend to be a lot more quotable than the ‘meh, I guess that’s fine’ folks.
    - deleted 4y ago
      [deleted]
    - megaman821 4y ago
      GM and Chrysler needed them to stay alive. Other companies (including some banks) just took them because why not, the future was uncertain. It turns out Tesla didn't actually need the loan so they paid it back early.
  - AtlasBarfed 4y ago
    See: PPP program, a near-trillion dollars of "Loans" that were not paid back. Why isn't the numerous instances of federal bailouts in thousands of other companies NOT a talking point if Tesla's is? Savings and Loans, Mortgage crisis, airlines, etc. If you don't think having a premier EV manufacturer in the US when the Chinese are otherwise poised for total domination of the sector isn't an economic national security issue, then I don't know what to tell you.
    - HWR_14 4y ago
      The PPP was multi-trillion, not near-trillion. And yes, there were a lot of issues with the PPP. That seems to have been fairly unique (thank goodness) The other federal bailouts aren't talked about often on HN, because they are not tech companies. And most of those conversations feature the talking point "they paid back the loan" as well. I have no idea why it's important. I'm fine with the government subsidizing EV manufacturing industries. That's not the question. The question is "why is it important they paid the loan back?"
  - tomschlick 4y ago
    Because at the time (2009 ish) auto companies were all getting bailout "loans" and many of them from the major auto corps were not paid back. Tesla got a fraction of what they did, and paid it back 9 years early and with interest.
    - bonestamp2 4y ago
      > many of them from the major auto corps were not paid back Which ones were not paid back? GM and Chrysler paid their government loans back. Ford paid their private equity loan back.
  - _ea1k 4y ago
    Its not so much that they paid them back, but that they paid them almost 10 years ago. That wasn't because they had tons of money, that was because the loan wasn't worth the problems it was causing.
  - bryanlarsen 4y ago
    Most of the time that the DOE loan is brought up, the context is the implication that Tesla and SpaceX are parasites that only survive on taxpayer bailouts. So "they paid the loan back" is a pre-emptive counter-strike against that narrative. Probably unnecessary in this case.
- blitzar 4y ago
  Spot me $465 million for a couple of weeks and I will get it right back to you.
  - deleted 4y ago
    [deleted]
jacobkranz 4y ago
Except that the DOE loan was for 465m. If they lost 1.7m in the quarter then the DOE loan wouldn't even be 1 month of operations. Even with inflation, the loan they received wouldn't touch the losses rivian has been having. I do love their trucks and hope they succeed though
- delusional 4y ago
  To anyone else confused while reading this. They lost 1.7 BILLION, the author of this comment mistakenly wrote 1.7 million. It's a simple typo.
Sakos 4y ago
https://en.wikipedia.org/wiki/Rivian#Public_company https://en.wikipedia.org/wiki/Rivian#Public_company They've already received $11b in private funding and another 13b from the IPO. I don't think money is the problem here.
adolph 4y ago
Another note about Rivian's later arrival to market is that it will have a harder time selling regulatory credits to other automakers. This profit center is decreasing over time but has averaged about 300M/Q. This is far from making up a 1.7B loss, but shows how Rivian doesn't have some of the first mover tailwinds. Additionally, while Rivian is a premium vehicle and may presumably attract a substantial number of cash buyers, increases in interest rates can't help sales. https://tesla-cdn.thron.com/static/WTULXQ_TSLA_Q3_2022_Update_KPK2Y7.pdf https://tesla-cdn.thron.com/static/WTULXQ_TSLA_Q3_2022_Updat... https://ir.tesla.com/#quarterly-disclosure https://ir.tesla.com/#quarterly-disclosure
_ea1k 4y ago
Instead, they've raised ~15B in capital. If Tesla had been able to do that, they wouldn't have needed a few hundred million in loans either.
__derek__ 4y ago
The DOE loans helped seed the industry by getting first movers off the ground. That worked, so why would it make more loans?

Shame, Rivian won't get the DOE loans that helped Tesla stay afloat.

bryanlarsen 4y ago

Tesla received $465 million in DOE loans, which it paid back. Rivian is going to need deeper pockets than that.

HWR_14 4y ago
> Tesla received $465 million in DOE loans, which it paid back. Why is "they paid the loan back" always a talking point?
- HorizonXP 4y ago
  Why is needing the DOE loan always a talking point? It is not a sin to enlist the help of others to achieve your goals.
  - lazide 4y ago
    A lot of people get angry when the money came from the gov’t (aka their taxes) without their permission to help someone who has more money than them.
    - HorizonXP 4y ago
      I know it’s a lot to ask of the general populace, but self-reflection is key here. I’m smart and confident. But I know that I would be a terrible person to give a $465m loan to. Money is our economy’s way of rewarding those of us with outsized skills. It’s far from perfect, but it’s the best we’ve got. Is Tesla and Elon the best place to put that $465m? Maybe, maybe not. But it was the best we had at the time, and I certainly don’t see anyone better than him now.
      - lazide 4y ago
        That is indeed a lot to ask of the general populace. But I don’t think even a majority of the populace had an issue with it anyway - it’s always the fringe extremists that get most of the press, they tend to be a lot more quotable than the ‘meh, I guess that’s fine’ folks.
  - deleted 4y ago
    [deleted]
  - megaman821 4y ago
    GM and Chrysler needed them to stay alive. Other companies (including some banks) just took them because why not, the future was uncertain. It turns out Tesla didn't actually need the loan so they paid it back early.
- AtlasBarfed 4y ago
  See: PPP program, a near-trillion dollars of "Loans" that were not paid back. Why isn't the numerous instances of federal bailouts in thousands of other companies NOT a talking point if Tesla's is? Savings and Loans, Mortgage crisis, airlines, etc. If you don't think having a premier EV manufacturer in the US when the Chinese are otherwise poised for total domination of the sector isn't an economic national security issue, then I don't know what to tell you.
  - HWR_14 4y ago
    The PPP was multi-trillion, not near-trillion. And yes, there were a lot of issues with the PPP. That seems to have been fairly unique (thank goodness) The other federal bailouts aren't talked about often on HN, because they are not tech companies. And most of those conversations feature the talking point "they paid back the loan" as well. I have no idea why it's important. I'm fine with the government subsidizing EV manufacturing industries. That's not the question. The question is "why is it important they paid the loan back?"
- tomschlick 4y ago
  Because at the time (2009 ish) auto companies were all getting bailout "loans" and many of them from the major auto corps were not paid back. Tesla got a fraction of what they did, and paid it back 9 years early and with interest.
  - bonestamp2 4y ago
    > many of them from the major auto corps were not paid back Which ones were not paid back? GM and Chrysler paid their government loans back. Ford paid their private equity loan back.
- _ea1k 4y ago
  Its not so much that they paid them back, but that they paid them almost 10 years ago. That wasn't because they had tons of money, that was because the loan wasn't worth the problems it was causing.
- bryanlarsen 4y ago
  Most of the time that the DOE loan is brought up, the context is the implication that Tesla and SpaceX are parasites that only survive on taxpayer bailouts. So "they paid the loan back" is a pre-emptive counter-strike against that narrative. Probably unnecessary in this case.
blitzar 4y ago
Spot me $465 million for a couple of weeks and I will get it right back to you.
- deleted 4y ago
  [deleted]

jacobkranz 4y ago

Except that the DOE loan was for 465m. If they lost 1.7m in the quarter then the DOE loan wouldn't even be 1 month of operations. Even with inflation, the loan they received wouldn't touch the losses rivian has been having. I do love their trucks and hope they succeed though

delusional 4y ago
To anyone else confused while reading this. They lost 1.7 BILLION, the author of this comment mistakenly wrote 1.7 million. It's a simple typo.

Sakos 4y ago

https://en.wikipedia.org/wiki/Rivian#Public_company https://en.wikipedia.org/wiki/Rivian#Public_company They've already received $11b in private funding and another 13b from the IPO. I don't think money is the problem here.

adolph 4y ago

Another note about Rivian's later arrival to market is that it will have a harder time selling regulatory credits to other automakers. This profit center is decreasing over time but has averaged about 300M/Q. This is far from making up a 1.7B loss, but shows how Rivian doesn't have some of the first mover tailwinds. Additionally, while Rivian is a premium vehicle and may presumably attract a substantial number of cash buyers, increases in interest rates can't help sales. https://tesla-cdn.thron.com/static/WTULXQ_TSLA_Q3_2022_Update_KPK2Y7.pdf https://tesla-cdn.thron.com/static/WTULXQ_TSLA_Q3_2022_Updat... https://ir.tesla.com/#quarterly-disclosure https://ir.tesla.com/#quarterly-disclosure

_ea1k 4y ago

Instead, they've raised ~15B in capital. If Tesla had been able to do that, they wouldn't have needed a few hundred million in loans either.

__derek__ 4y ago

The DOE loans helped seed the industry by getting first movers off the ground. That worked, so why would it make more loans?