7 ms·

Tesla Gets $350 Million In Government Money to Build Model S Sedan

51 points by Flemlord 18y ago

ensignavenger 18y ago
They also plan on being profitable by mid-year. I wonder if GM, Ford, or Chrysler could say the same? At least the Government has a good chance of their loan to Tesla being repaid!
- Silentio 18y ago
  Yes, it seems like Tesla Motors is building their business the right way. They certainly picked the right name for the company!
  - ensignavenger 18y ago
    I agree- I love the name. Nikola Tesla was a brilliant man.
- mbowcock 18y ago
  It doesn't sound like the money is as wrapped up as the companies press release sounds. http://www.bizjournals.com/sanjose/stories/2009/02/09/daily67.html http://www.bizjournals.com/sanjose/stories/2009/02/09/daily6... Tesla's plan to be profitable depends on getting the model S built but they can't build the model S unless they get government money. The government won't give them the money unless they can prove viability. Sounds like this won't be resolved for a while.
- ssharp 18y ago
  Didn't it just come out that their product costing was completely off-base and every car was being sold at a loss. This company has never impressed me and they just don't seem to have the leadership to ever become viable. They've already burned through lots of money, promising the whole time that profitability is right around the corner. This model isn't going to be out until 2011, by then, GM and Toyota will likely have more commercially viable PHEV models available to the public. I just don't see Tesla getting past a niche market. ANd getting past that point should be the expectation given the size of this loan.
  - electromagnetic 18y ago
    Toyota I can see having more commercially viable PHEV models, but have you paid attention to any NA automaker's adverts recently? They haven't even noticed that they're in a burning house carrying a crate of gunpowder. I mean watch the commercial for the new Ford F-150, it has steps. Yes their selling feature right now is steps. It's mentally retarded, they completely gloss over the fact they've increased the carrying and towing capacity for the vehicle because they've got steps. They even say something like 'with the extra capacity, you'll need those steps more than ever' and I'm just trying to think through the logic there, because whenever I've seen a truck fully loaded it's been done by a fork lift or a bobcat for when we filled the sucker full of sand... it had a purpose, I swear! And it wasn't sandcastles neither. My point is, is that everybody is watching gas prices to see when they spike up again. The price is quite nice here in Canada, but we're all waiting for it to double and be at the same price it was last summer. What no NA automaker seems to realise is that the market has completely changed, right now almost everyone is wanting fuel efficiency because everyone's afraid they're going to be spending a fortune commuting.
    - ryanwaggoner 18y ago
      they completely gloss over the fact they've increased the carrying and towing capacity for the vehicle because they've got steps Sadly, this might just be because they know their market and they know that most people who buy the F-150 aren't using it to tow stuff, but are the type who are more likely to buy it because it has shiny steps.
      - HeyLaughingBoy 18y ago
        You're partly right: I think it's because all the vehicles in its class have roughly the same capability, but the steps can differentiate the F150 from the competition. Around here any truck sold from dealer inventory automatically comes with a tow package and will at least occasionally be used to tow something. Even my Xterra is sometimes used to tow a trailer. People are still buying big trucks: I just bought my wife a used F250 with 7.3L diesel and it's her daily ride!
jacoblyles 18y ago
Forget Y Combinator. I'm applying to TARP.
- vaksel 18y ago
  the application form is probably shorter too
  - corentin 18y ago
    Usually it's the size of a business card.
- kubrick 18y ago
  As long as you don't mind getting a loan instead of straight funding, apply on, my brother.
3pt14159 18y ago
Ok, now I'm 100% certain that the price of lithium is going to skyrocket. There isn't that much of the stuff pulled out of the ground every year, and most of it goes to small battery applications - not cars like the Tesla. Toyota's electric cars have purposefully stayed away from lithium because they knew that there was not enough lithium for Toyota sized production. Unfortunately lithium is not traded on any futures market that I know of, and I know of no publicly traded stock on any exchange that solely represents lithium mining interests. Does anyone know how I can buy bulk ($25k+) lithium? I'd prefer not to buy it from a science supply store. I'm getting a quote from http://www.baotou-rareearth.com/ http://www.baotou-rareearth.com/ right now, but ideally there would be an ETF that tracks the price for me.
- pchristensen 18y ago
  I read this a while ago - http://www.forbes.com/forbes/2008/1124/034.html http://www.forbes.com/forbes/2008/1124/034.html Symbols SQM and POT from the article are relevant if you want to invest in Lithium.
mynameishere 18y ago
Can I give a strong suggestion that news stories not be submitted from obviously-biased sources? The headline should be the same as what the reliably-green nytimes asked a few months ago: http://dealbook.blogs.nytimes.com/2008/12/01/should-taxpayers-pay-to-back-tesla-motors/ http://dealbook.blogs.nytimes.com/2008/12/01/should-taxpayer... The Tesla business model, to me, seems hopeless. Look: There's nothing special about running vehicles by battery. They were doing it many decades ago. Every big factory and every golf course has numerous electric vehicles. In the proper context, they're just great. The technology is well-established, but thus far none of the manufacturers thought it wise to move from factory to highway. I'm guessing there are some good reasons, among which is the fact that diesel cars are usually more efficient...
- bishvili 18y ago
  This article is factually incorrect since they were not actually approved for the loans yet. http://www.greencarreports.com/blog/1018501_no-damnit-tesla-has-not-been-approved-for-loans-yet http://www.greencarreports.com/blog/1018501_no-damnit-tesla-...
- eande 18y ago
  “fact that diesel cars are usually more efficient...” is true if compared to a gasoline combustion engine. But there is no simple comparison on efficiency between the 2 different technology battery vs gasoline. My take is the other way. Loan several billion dollar to any of the big three is not doing much. The cash burn rate they have will eat the money quickly and just to survive. Since the first oil crises in the ‘70 any of the Detroit companies had lots of time to spend R&D money on alternative power train solutions. They decided not to do a lot for multibillion dollar revenue companies other than building bigger and bigger SUVs. Japanese car manufacture by now have some lead in hybrid and battery technology and a small company Tesla has in my opinion a better chance to compete in this segment.
  - tjic 18y ago
    > there is no simple comparison on efficiency between the 2 different technology battery vs gasoline. What's wrong with "km/J" ?
amix 18y ago
The major problem with electric cars is building an infrastructure for them. First, they can run around 100-150km (60 - 100miles) and after this they must recharge for a day or so. I.e. they are pretty useless on longer trips. In Denmark, Dong Energy (which is Denmark's biggest energy company) has signed an agreement with Better Place to build electric "gas stations" where one can drive in and get a fresh battery. I think Israel also has an agreement. And with such gas stations, electric cars could be a very fine choice since they are cheaper (pr. km) and a lot more environment friendly. And Teslas are pretty hot, so it would probably be a very good investment by the US gov. Sources: http://en.wikipedia.org/wiki/DONG_Energy http://en.wikipedia.org/wiki/DONG_Energy http://en.wikipedia.org/wiki/Project_Better_Place http://en.wikipedia.org/wiki/Project_Better_Place
- Retric 18y ago
  FYI: your numbers are wrong. http://www.teslamotors.com/performance/perf_specs.php http://www.teslamotors.com/performance/perf_specs.php Tesla Roadster Range: About 220 miles (based on EPA combined city/highway cycle) Full Charge: About 3.5 hours using the Tesla Motors High Power Connector. One of the better suggestions I have heard was an all electric car where you could use an external generator for long trips. 95+% of the time you don't need and save a lot of weight over a hybrid but it but it's still an option for long trips and you could even add extra storage space.
  - ryanwaggoner 18y ago
    One of the better suggestions I have heard was an all electric car where you could use an external generator for long trips. 95+% of the time you don't need and save a lot of weight over a hybrid... Why is this better than a hybrid? Would the generator be powerful enough to provide enough electricity to operate the car? If so, I have a hard time seeing how you would save weight or how it would be more efficient, since you're going to have more steps in the process, each with more efficiency loss.
    - Retric 18y ago
      A 30hp generator would be sufficient to give a car essentially unlimited range, but it adds a few grand in cost, 4-500 lb's of weight and a host of mechanical issues. If you don't need it 95% of the time what's the value in dragging it around? If you can rent it for less than the cost of ownership what's the value in renting it?
lunchbox 18y ago
As a side note, I dislike the term "government money," since it makes it easy to forget the the money ultimately comes not from the government but from the people. "Taxpayer money", on the other hand, has a pejorative connotation, since it is often used derisively. Maybe "public money"?
- Alex3917 18y ago
  Except for that the money doesn't come from the people, since it is fiat money as opposed to money being collected via taxes.
  - gravitycop 18y ago
    Except for that the money doesn't come from the people, since it is fiat money Don't you mean "seigniorage" money? http://en.wikipedia.org/wiki/Seigniorage http://en.wikipedia.org/wiki/Seigniorage as opposed to money being collected via taxes. Isn't seigniorage a type of tax? http://en.wikipedia.org/wiki/Seigniorage http://en.wikipedia.org/wiki/Seigniorage seigniorage is also referred to as an inflation tax [...] the "inflation tax" is paid by those who hold the existing currency, which results from their holdings of currency becoming devalued through inflation because of the introduction of additional money supply.
    - Alex3917 18y ago
      "Isn't seigniorage a type of tax?" Yes, but it's not a tax on the people, it's a tax on dollar holders.
  - fauigerzigerk 18y ago
    That's a fair point to make in relation to a loan that must be repaid. But actual government debt has to be backed by a claim to someone's labour and that someone is the tax payer. If there is no such backing all that fiat money will quickly lose its value.
- corentin 18y ago
  There's no such thing as "public" money; it always comes from private pockets and ends up in (different) private pockets. I can't see what's pejorative about taxpayer money. That's whom it comes from.
donniefitz2 18y ago
Here is your state issued car.

51 points by Flemlord 18y ago

They also plan on being profitable by mid-year. I wonder if GM, Ford, or Chrysler could say the same? At least the Government has a good chance of their loan to Tesla being repaid!

Silentio 18y ago
Yes, it seems like Tesla Motors is building their business the right way. They certainly picked the right name for the company!
- ensignavenger 18y ago
  I agree- I love the name. Nikola Tesla was a brilliant man.
mbowcock 18y ago
It doesn't sound like the money is as wrapped up as the companies press release sounds. http://www.bizjournals.com/sanjose/stories/2009/02/09/daily67.html http://www.bizjournals.com/sanjose/stories/2009/02/09/daily6... Tesla's plan to be profitable depends on getting the model S built but they can't build the model S unless they get government money. The government won't give them the money unless they can prove viability. Sounds like this won't be resolved for a while.
ssharp 18y ago
Didn't it just come out that their product costing was completely off-base and every car was being sold at a loss. This company has never impressed me and they just don't seem to have the leadership to ever become viable. They've already burned through lots of money, promising the whole time that profitability is right around the corner. This model isn't going to be out until 2011, by then, GM and Toyota will likely have more commercially viable PHEV models available to the public. I just don't see Tesla getting past a niche market. ANd getting past that point should be the expectation given the size of this loan.
- electromagnetic 18y ago
  Toyota I can see having more commercially viable PHEV models, but have you paid attention to any NA automaker's adverts recently? They haven't even noticed that they're in a burning house carrying a crate of gunpowder. I mean watch the commercial for the new Ford F-150, it has steps. Yes their selling feature right now is steps. It's mentally retarded, they completely gloss over the fact they've increased the carrying and towing capacity for the vehicle because they've got steps. They even say something like 'with the extra capacity, you'll need those steps more than ever' and I'm just trying to think through the logic there, because whenever I've seen a truck fully loaded it's been done by a fork lift or a bobcat for when we filled the sucker full of sand... it had a purpose, I swear! And it wasn't sandcastles neither. My point is, is that everybody is watching gas prices to see when they spike up again. The price is quite nice here in Canada, but we're all waiting for it to double and be at the same price it was last summer. What no NA automaker seems to realise is that the market has completely changed, right now almost everyone is wanting fuel efficiency because everyone's afraid they're going to be spending a fortune commuting.
  - ryanwaggoner 18y ago
    they completely gloss over the fact they've increased the carrying and towing capacity for the vehicle because they've got steps Sadly, this might just be because they know their market and they know that most people who buy the F-150 aren't using it to tow stuff, but are the type who are more likely to buy it because it has shiny steps.
    - HeyLaughingBoy 18y ago
      You're partly right: I think it's because all the vehicles in its class have roughly the same capability, but the steps can differentiate the F150 from the competition. Around here any truck sold from dealer inventory automatically comes with a tow package and will at least occasionally be used to tow something. Even my Xterra is sometimes used to tow a trailer. People are still buying big trucks: I just bought my wife a used F250 with 7.3L diesel and it's her daily ride!

jacoblyles 18y ago

Forget Y Combinator. I'm applying to TARP.

vaksel 18y ago
the application form is probably shorter too
- corentin 18y ago
  Usually it's the size of a business card.
kubrick 18y ago
As long as you don't mind getting a loan instead of straight funding, apply on, my brother.

3pt14159 18y ago

Ok, now I'm 100% certain that the price of lithium is going to skyrocket. There isn't that much of the stuff pulled out of the ground every year, and most of it goes to small battery applications - not cars like the Tesla. Toyota's electric cars have purposefully stayed away from lithium because they knew that there was not enough lithium for Toyota sized production. Unfortunately lithium is not traded on any futures market that I know of, and I know of no publicly traded stock on any exchange that solely represents lithium mining interests. Does anyone know how I can buy bulk ($25k+) lithium? I'd prefer not to buy it from a science supply store. I'm getting a quote from http://www.baotou-rareearth.com/ http://www.baotou-rareearth.com/ right now, but ideally there would be an ETF that tracks the price for me.

pchristensen 18y ago
I read this a while ago - http://www.forbes.com/forbes/2008/1124/034.html http://www.forbes.com/forbes/2008/1124/034.html Symbols SQM and POT from the article are relevant if you want to invest in Lithium.

mynameishere 18y ago

Can I give a strong suggestion that news stories not be submitted from obviously-biased sources? The headline should be the same as what the reliably-green nytimes asked a few months ago: http://dealbook.blogs.nytimes.com/2008/12/01/should-taxpayers-pay-to-back-tesla-motors/ http://dealbook.blogs.nytimes.com/2008/12/01/should-taxpayer... The Tesla business model, to me, seems hopeless. Look: There's nothing special about running vehicles by battery. They were doing it many decades ago. Every big factory and every golf course has numerous electric vehicles. In the proper context, they're just great. The technology is well-established, but thus far none of the manufacturers thought it wise to move from factory to highway. I'm guessing there are some good reasons, among which is the fact that diesel cars are usually more efficient...

bishvili 18y ago
This article is factually incorrect since they were not actually approved for the loans yet. http://www.greencarreports.com/blog/1018501_no-damnit-tesla-has-not-been-approved-for-loans-yet http://www.greencarreports.com/blog/1018501_no-damnit-tesla-...
eande 18y ago
“fact that diesel cars are usually more efficient...” is true if compared to a gasoline combustion engine. But there is no simple comparison on efficiency between the 2 different technology battery vs gasoline. My take is the other way. Loan several billion dollar to any of the big three is not doing much. The cash burn rate they have will eat the money quickly and just to survive. Since the first oil crises in the ‘70 any of the Detroit companies had lots of time to spend R&D money on alternative power train solutions. They decided not to do a lot for multibillion dollar revenue companies other than building bigger and bigger SUVs. Japanese car manufacture by now have some lead in hybrid and battery technology and a small company Tesla has in my opinion a better chance to compete in this segment.
- tjic 18y ago
  > there is no simple comparison on efficiency between the 2 different technology battery vs gasoline. What's wrong with "km/J" ?

amix 18y ago

The major problem with electric cars is building an infrastructure for them. First, they can run around 100-150km (60 - 100miles) and after this they must recharge for a day or so. I.e. they are pretty useless on longer trips. In Denmark, Dong Energy (which is Denmark's biggest energy company) has signed an agreement with Better Place to build electric "gas stations" where one can drive in and get a fresh battery. I think Israel also has an agreement. And with such gas stations, electric cars could be a very fine choice since they are cheaper (pr. km) and a lot more environment friendly. And Teslas are pretty hot, so it would probably be a very good investment by the US gov. Sources: http://en.wikipedia.org/wiki/DONG_Energy http://en.wikipedia.org/wiki/DONG_Energy http://en.wikipedia.org/wiki/Project_Better_Place http://en.wikipedia.org/wiki/Project_Better_Place

Retric 18y ago
FYI: your numbers are wrong. http://www.teslamotors.com/performance/perf_specs.php http://www.teslamotors.com/performance/perf_specs.php Tesla Roadster Range: About 220 miles (based on EPA combined city/highway cycle) Full Charge: About 3.5 hours using the Tesla Motors High Power Connector. One of the better suggestions I have heard was an all electric car where you could use an external generator for long trips. 95+% of the time you don't need and save a lot of weight over a hybrid but it but it's still an option for long trips and you could even add extra storage space.
- ryanwaggoner 18y ago
  One of the better suggestions I have heard was an all electric car where you could use an external generator for long trips. 95+% of the time you don't need and save a lot of weight over a hybrid... Why is this better than a hybrid? Would the generator be powerful enough to provide enough electricity to operate the car? If so, I have a hard time seeing how you would save weight or how it would be more efficient, since you're going to have more steps in the process, each with more efficiency loss.
  - Retric 18y ago
    A 30hp generator would be sufficient to give a car essentially unlimited range, but it adds a few grand in cost, 4-500 lb's of weight and a host of mechanical issues. If you don't need it 95% of the time what's the value in dragging it around? If you can rent it for less than the cost of ownership what's the value in renting it?

lunchbox 18y ago

As a side note, I dislike the term "government money," since it makes it easy to forget the the money ultimately comes not from the government but from the people. "Taxpayer money", on the other hand, has a pejorative connotation, since it is often used derisively. Maybe "public money"?

Alex3917 18y ago
Except for that the money doesn't come from the people, since it is fiat money as opposed to money being collected via taxes.
- gravitycop 18y ago
  Except for that the money doesn't come from the people, since it is fiat money Don't you mean "seigniorage" money? http://en.wikipedia.org/wiki/Seigniorage http://en.wikipedia.org/wiki/Seigniorage as opposed to money being collected via taxes. Isn't seigniorage a type of tax? http://en.wikipedia.org/wiki/Seigniorage http://en.wikipedia.org/wiki/Seigniorage seigniorage is also referred to as an inflation tax [...] the "inflation tax" is paid by those who hold the existing currency, which results from their holdings of currency becoming devalued through inflation because of the introduction of additional money supply.
  - Alex3917 18y ago
    "Isn't seigniorage a type of tax?" Yes, but it's not a tax on the people, it's a tax on dollar holders.
- fauigerzigerk 18y ago
  That's a fair point to make in relation to a loan that must be repaid. But actual government debt has to be backed by a claim to someone's labour and that someone is the tax payer. If there is no such backing all that fiat money will quickly lose its value.
corentin 18y ago
There's no such thing as "public" money; it always comes from private pockets and ends up in (different) private pockets. I can't see what's pejorative about taxpayer money. That's whom it comes from.

donniefitz2 18y ago

Here is your state issued car.