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Tesla Motors To Pay Off Government Loan 5 Years Early

Soulskill posted about a year ago | from the a-sure-sign-that-EVs-are-the-devil dept.

Government 243

fredan sends word of a post at the Tesla Motors blog detailing how the company will be paying off its $465 million government loan 5 years early. Quoting: "This is a significant announcement both for Tesla and for the DOE. It is a marker of the successful launch of the Model S and the incredible market reaction to this award-winning car. And it is a tribute to the success of the DOE's Advanced Technology Vehicle Manufacturing Program (ATVM), a program which was chartered by Congress and signed into law by President George W. Bush, to accelerate the market for a broad range of promising automotive efficiency technologies — electric vehicles (EVs) principal among them. ... Following more than a year of thorough due diligence by commercial auditors, automotive consultants and lawyers, on January 20, 2010, Tesla became the recipient of one of three initial DOE loans announced by Secretary Chu, along with Ford and Nissan – good company for a start-up automaker. Tesla’s loan of $465 million was to be paid back over ten years following the start of production of the Model S. Months later in a separate announcement, an ATVM loan was announced for Fisker. It is worth noting that in comparison with these three other recipients, Tesla had the smallest loan. Ford’s loan was for $5.9 billion, Nissan’s was for $1.4 billion, and Fisker’s was for $529 million. ... We expect to generate sufficient cash and profitability in our business over the next five years that it gives us confidence to proceed with this early repayment of the loan. Moreover, it is also consistent with Tesla’s mantra of speed that we would, as Elon announced last week, accelerate the repayment of our loan, a full five years earlier than required under the original loan terms, making our last payment in 2017."

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Jackpot? (-1)

ButchDeLoria (2772751) | about a year ago | (#43117051)

They're either using the Apple method of product pricing, or they got a big bribe from the NY Times and Top Gear.

Re:Jackpot? (0)

eksith (2776419) | about a year ago | (#43117159)

I can picture the NY Times doing it, but definitely not Top Gear or else Clarkson would be setting the world on fire the very next episode. Unless of course, they kept it quite from him. But this seems very unlikely.

The cynic in me thinks it's the Apple method, but the hopeful part says, they genuinely earned(ing) enough.

Re:Jackpot? (5, Funny)

Cpt_Kirks (37296) | about a year ago | (#43117177)

If I win the Powerball Saturday, I may buy one. If I can afford it...

Re:Jackpot? (5, Insightful)

Grayhand (2610049) | about a year ago | (#43117677)

If I win the Powerball Saturday, I may buy one. If I can afford it...

Let's be realistic, Tesla has never released an economy car for good reasons so the same comments could be made of any higher end car. Tesla has focused on range and top end performance. They can't win this argument because if they release an economy car it will still be fairly pricey and people will complain about range and performance. It's an early adopter company and we will all benefit in the end as costs drop. They want to make money and at this point Elon Musk needs to make money because he invested most of his cash in these high end risky ventures so they would make an economy car if they could. Most of the talk I hear is it's less convenient so it should be cheaper. That's unlikely to ever happen and it ignores the other advantages. You might as well say I won't buy a gasoline car unless I can refuel it at home and gas cost less than a $1 a gallon, just to be fair. Most electric car owners love the fact they can refuel at home and electricity is cheaper not because it's a better fuel source but internal combustion engines are really inefficient when they don't run at a constant speed. It's why hybrids running an undersized gas or diesel engine to charge batteries has been my favorite. The truth is all the Tesla cars have been on par or better with the performance you'd expect for the price range. That is impressive. If you are holding out for a 15K Model S then you might as well hold out for a 15K Mercedes Sedan!

Re:Jackpot? (0)

Anonymous Coward | about a year ago | (#43118011)

You can get a used Mercedes for that. But if you can't afford Mercedes new, you probably can't afford the maintenance costs anyway.

Re:Jackpot? (3, Insightful)

AmiMoJo (196126) | about a year ago | (#43118141)

It isn't actually that expensive. Fairly comparable to a similarly equipped BMW or Lexus. Thing is you save money on fuel and even get it for free some times, so over the car's lifetime it is cheaper.

Re:Jackpot? (4, Insightful)

thomasw_lrd (1203850) | about a year ago | (#43118169)

From my understanding, this was the business plan all along. Let's build really expensive bad ass sports cars that are all electric. Once they made enough money on those, they could start adapting the technology to be cheaper and cheaper. All the while still selling an expensive bad ass sports car for the same price.

Its seems the Model S is part two of this plan.

Seemed genius to me.

Re:Jackpot? (5, Interesting)

Teancum (67324) | about a year ago | (#43118209)

In addition to your excellent reply, it should be worth noting that the route manufacturing companies get cheap consumer prices (like Henry Ford did with the Model T) is to have massive production where you make up profits through volume sales and scales of efficiency. That is something incredibly hard for any start-up company to perform, where it costs roughly a couple billion dollars just to start a major new low-cost automobile with production runs in the hundreds of thousands of editions.

Elon Musk was incredibly intelligent to start out with the high end automobiles, especially the niche market of performance sports cars with a little bit of a twist. The Model S is really aiming more toward the luxury sedan market... again a very astute move on his part where the Model S clearly compares well with a Lexis or Mercedes Benz (or the Lincoln branded cars by General Motors). Volume of the vehicle production line doesn't have to be quite so high for these kind of vehicles and ultimately doesn't take as much cash to get them started.

The original approach that Tesla was going to take was to simply buy off the shelf components already being made by several automobile manufacturers and simply assemble a new automobile. Unfortunately because of quality control and inventory issues Tesla has been forced to increasingly build more and more components "in-house". One example was the transmission needed for the Roadster that very nearly bankrupted the company (and forced Elon Musk to double down and dump essentially all liquid assets that he had into Tesla as well as make a whole bunch of phone calls to friends with money to help out). And yes, Tesla automobiles do have a transmission... even if it is pretty simple in its design.

It is in the announced product line of development that eventually Tesla is going to be building economy automobiles, but that the original plan was to wait until they had both the manufacturing facility (that they now have with the NUMMI plant in California) and the working capital needed to get it all to happen.

The only thing that I am a bit surprised at myself is not the cheap low-end automobiles, but rather why Tesla hasn't moved into the all-electric delivery van market (aka FedEx trucks) or even the short haul semi-trailer tractor market where people routinely dump more money on vehicle purchases that would make a typical sports car enthusiast look twice at the price tag and doubt they could foot the bill. There are electric vehicles in those markets, and having corporations set up charging stations for a fleet of vehicles would be even a bonus (on site refueling without having to deal with petroleum companies). The drawback might be the existing competition as well as the fact that such companies are less likely to be hung up in the "green energy" hype.... and that Tesla can only do so many things at the same time. There are also a bunch of patent trolls hanging out in those markets with patents for electric vehicles of those types as well.... that might be causing some additional problems.

Re:Jackpot? (1, Insightful)

i kan reed (749298) | about a year ago | (#43117241)

Well, seeing as they're the only real competitor in the electric marketplace, they can price as a monopoly would until their success drives competitors into the same market. That's one of those things in supply and demand that quietly gets glossed over in econ 101 but is really important.

Re:Jackpot? (1)

isorox (205688) | about a year ago | (#43117447)

Well, seeing as they're the only real competitor in the electric marketplace, they can price as a monopoly would until their success drives competitors into the same market. That's one of those things in supply and demand that quietly gets glossed over in econ 101 but is really important.

But there's still competition you don't need an electric car, you can get a normal one.

Just like Amtrak has competition on New York - Washington transport from Greyhound and the planes.

Re:Jackpot? (1)

Ogive17 (691899) | about a year ago | (#43117523)

The only way Tesla is unique is that their entire product line is based on electric motor propulsion. Competition does exist for electric vehicles.

It would be silly for Tesla to price their vehicles out of the budget for middle class families. As an employee of an auto manufacturer, the money is made on server parts, not unit sales. That being said, the best option for Tesla long term is to sell more units. They may want the hipster image like Apple currently has... making a $400 impulse buy is slightly different than a $50,000 one.

If they were smart, they'd price the sedan to move... not to have a huge profit margain.

Re:Jackpot? (2)

h4rr4r (612664) | about a year ago | (#43117835)

There are not a lot of parts to sell on the Tesla. Unlike a traditional car there is also a lot less maintenance. I for one can't wait until I own a car like that. Oil changes suck, parts suck, lead acid batteries suck.

Re:Jackpot? (0)

Anonymous Coward | about a year ago | (#43118053)

If they were smart, they'd price the sedan to move... not to have a huge profit margain.

You really ought to get in touch with Musk. He'd probably pay a significant consulting fee for your valuable insights.

Re:Jackpot? (4, Interesting)

Luckyo (1726890) | about a year ago | (#43118295)

The reason for this is because variable RPM internal combustion engine with all its peripherals is very complex structure and requires a lot of maintenance and spare parts.

This is not true for electric engine, which is a very simple in design and as a result far more reliable. This is the simple reality of engine technology, and a known limitation of internal combustion engines, which is why hybrids run a constant RPM internal combustion engine to charge the battery rather then variable RPM internal combustion engine to actually run the car. Former is simply more efficient and requires less complexity and as a result maintenance.

Re:Jackpot? (0)

Anonymous Coward | about a year ago | (#43117805)

That's one of those things in supply and demand that quietly gets glossed over in econ 101 but is really important.

I don't think I've seen an intro econ class that didn't go on from supply and demand to discuss the effects of price floors/ceilings, and monopoly pricing, usually leading at least up to a discussion of deadweight losses. Maybe everyone I know just happened to go to better than average US public high schools...

Re:Jackpot? (1)

chispito (1870390) | about a year ago | (#43118155)

No competition for the class of electric car they are making, but there are other electric cars available. Or, at least, I see Nissan LEAFs on the highway.

Re:Jackpot? (5, Informative)

romanval (556418) | about a year ago | (#43117423)

They didn't have to bribe anyone. The Model S is a highly acclaimed car from everyone else's perspective:

  • Automobile Magazine's 2013 Car of the Year
  • Motor Trend 2013 Car of the Year.
  • Popular Science's Auto Grand Award Winner Best of What's New list 2012.
  • Time Magazine Best 25 Inventions of the Year 2012 award.
  • Yahoo! Autos 2013 Car of the Year.
  • CNET Tech Car of the Year for 2012
  • Green Car Reports' Best Car To Buy 2013
  • 2013 AutoGuide.com Reader’s Choice Car of the Year
  • Natural Resources Canada 2013 EcoENERGY for Vehicles Awards in the full-size category

 
Not bad for a car company that didn't exist 10 years ago

Re:Jackpot? (0)

Anonymous Coward | about a year ago | (#43117821)

So was the Volt.

Re:Jackpot? (4, Interesting)

Teancum (67324) | about a year ago | (#43118343)

The Volt is widely acknowledged to have been started explicitly because the CEO of General Motors took a bunch of marketing literature from Tesla Motors and threw it down on the desks of his engineers asking why a California start-up company could make a successful electric automobile but they couldn't. The rest, as they say, is history.

Mind you, the Volt is a pretty good automobile and deserves its own kind of kudos. The GM engineers made some compromises that I don't agree with, but I'm not exactly a professional automotive engineer nor have been put into their position to design a new automobile from scratch. Doing such things isn't as easy as it sounds.

Re:Jackpot? (0)

jimbolauski (882977) | about a year ago | (#43118373)

They didn't have to bribe anyone. The Model S is a highly acclaimed car from everyone else's perspective:

  • Automobile Magazine's 2013 Car of the Year
  • Motor Trend 2013 Car of the Year.
  • Popular Science's Auto Grand Award Winner Best of What's New list 2012.
  • Time Magazine Best 25 Inventions of the Year 2012 award.
  • Yahoo! Autos 2013 Car of the Year.
  • CNET Tech Car of the Year for 2012
  • Green Car Reports' Best Car To Buy 2013
  • 2013 AutoGuide.com Reader’s Choice Car of the Year
  • Natural Resources Canada 2013 EcoENERGY for Vehicles Awards in the full-size category

Not bad for a car company that didn't exist 10 years ago

Being highly acclaimed and being a success are two very different things. Tesla has a small market they are competing with Porsches, BMW's, Audi's, Lotuses. The Model S is outclasses in every measurable category except fuel cost, and emissions then is comparably priced competitors. It is an environmental feel good sports car and while it is cool the only reason they can compete is people buy it to feel smug. It revived those awards because it was the first electric car that was not lame.

Bad news for Elon haters (1, Insightful)

benjfowler (239527) | about a year ago | (#43117059)

It'll be interesting to see how the reflexive, knee-jerk Elon haters spin this one

Re:Bad news for Elon haters (0, Insightful)

Anonymous Coward | about a year ago | (#43117271)

I don't have any feelings for Elon, but "company claims it will do splendid thing in future" is barely news, and certainly not worthy of praise. Until it's done.

Re:Bad news for Elon haters (3, Insightful)

Anonymous Coward | about a year ago | (#43118139)

I'm sorry, AC, what fuzzy logic world are you living in? It is done already. The cars are being produced, sold and used...they are making money and will continue to do so. It's done.

Re:Bad news for Elon haters (0)

Anonymous Coward | about a year ago | (#43117347)

Proff that teh Socialism dozn't werk!!111!!

</Rush-listening idiot who doesn't even know what the word "Socialism" means but likes to whine about it>

Re:Bad news for Elon haters (0)

Dishevel (1105119) | about a year ago | (#43117495)

On the other hand some people still do not believe that Government has no right to pick a company to loan money to.
Oil companies, Solar companies, Car companies, Corn Farmers, none of them.

Re:Bad news for Elon haters (1)

ChrisMaple (607946) | about a year ago | (#43117779)

Would you mind clarifying your claim? The double negative makes me think you don't mean what you've written.

Re:Bad news for Elon haters (4, Insightful)

Ossifer (703813) | about a year ago | (#43117907)

Oil companies aren't getting loans--they're getting huge piles of cash for free. If those who believe that Government has no right to pick a company to loan money to, they should start with the loans that don't get paid back.

Re:Bad news for Elon haters (0)

Anonymous Coward | about a year ago | (#43118025)

Thought I made clear that I do not believe that any Company, Farmer, Rancher, Ethnic Group or Gender, should be propped up above others by the government.

Re:Bad news for Elon haters (1)

Ossifer (703813) | about a year ago | (#43118071)

Thought I made clear that such people should start complaining about the massive cash handouts to the oil industry first.

Re:Bad news for Elon haters (0)

Anonymous Coward | about a year ago | (#43118037)

Solyndra [wikipedia.org] was a loss that more than offsets this loan being paid back.

Re:Bad news for Elon haters (1)

Ossifer (703813) | about a year ago | (#43118103)

And GM's loan payback more than offsets, blah blah blah...

These are investments in the economy that pay off in more way that mere bank-style loans.

Re:Bad news for Elon haters (0)

Anonymous Coward | about a year ago | (#43118175)

How big would a loan have to be for the interest on it to make up a $500 million loss elsewhere? Pretty damn big. Especially when these are low-interest government subsidized loans.

Re:Bad news for Elon haters (1)

MickyTheIdiot (1032226) | about a year ago | (#43117961)

That is a valid position. The problem is that the vast majority of people taking it (like most political positions currently) are disingenuous. They're absolutely fine taking the position when it suits their needs (IE they don't like research into alternative fuels) and forgetting about their "firmly held belief" when it doesn't (for instance corporate welfare to their oil contributors). It's worse when these same people have a constituency that allow them to get away with it.

I respect people who hold non-hypocritial beliefs. You have to look at the histories and the every Washington politician that makes claims that they are following their beliefs. It's all about lobbyists, not beliefs.

Re:Bad news for Elon haters (2)

phantomfive (622387) | about a year ago | (#43117357)

Remember when the big banks 'paid off' TARP, but in reality were just recycling back money they got from the federal reserve/treasury?

It's kind of the same thing here; if you consider all the subsidies for electric cars, the government is still paying a LOT of money to Tesla. It will be more interesting to see the Bush lovers try to justify the fact that their president was 'distorting the market' and driving up the debt with subsidies to private industry. If there are any Bush lovers still around.

Good to see that Tesla is selling enough to make that kind of money though. Hopefully electric cars will become even more common, and cheaper, and more common, in a virtuous cycle.

Re:Bad news for Elon haters (1)

bluefoxlucid (723572) | about a year ago | (#43117413)

The best part is HOW they're paying it back. Around here I can get $600 off my taxes for installing high-efficiency heating systems and heat pumps. Trane advertises this strongly--and $600 cash back discount is bigger than $600 expense (psychology trick, people like free stuff, people like "good deals"), so a $1000 system becomes a $2000 system you get $600 for and spend $1400 on.

Re:Bad news for Elon haters (1)

Dishevel (1105119) | about a year ago | (#43117607)

Bush was a Republican. He was not anything close to a conservative though.
The only thing worse than Bush since Jimmy Carter was Obama.

Re:Bad news for Elon haters (1)

phantomfive (622387) | about a year ago | (#43117703)

So according to your ranking, of the last 6 presidents, Bush jr was #4 out of 6? Not bad, about like his grades.

Re:Bad news for Elon haters (0)

Anonymous Coward | about a year ago | (#43117969)

He might even be #5.
He grew the government massively.
He also threw a bunch of our freedoms under the bus.
I never liked Obama but when he was elected I thought that maybe some good would come of it. I found it difficult to believe he could do worse than Bush.
He did pull it off though. Grew government even bigger while losing jobs. Took more freedoms.
Jimmy Carter might be worse than Bush. I can not reall9y make up my mind though. At least Bush did the Presidential thing of shutting the fuck up after getting out of office.
Kind of wish Jimmy could figure that one out.

Re:Bad news for Elon haters (1)

characterZer0 (138196) | about a year ago | (#43117365)

He borrowed government money to create a bunch of luxury cars for the rich.

He has not actually paid it back yet, he still has four years to bankrupt the company.

We had hope that rising gasoline prices and tightening emissions controls would lead to development of public transportation and people-focused instead of car-focused infrastructure design in the US, but these electric car pushers are damning us to a future where we are cursed by subsidized parking space, clogged expressways, and coal plants instead of subsidized parking space, clogged expressways, and oil refineries.

Re:Bad news for Elon haters (1)

ChrisMaple (607946) | about a year ago | (#43117871)

You think subsidized parking spaces is a good idea? So that more traffic will be attracted to city centers, paid for by the carless slum dwellers?
------
Go green: turn off your refrigerator.
Yup, that green meat is really healthful.

Re:Bad news for Elon haters (1)

bluefoxlucid (723572) | about a year ago | (#43118211)

Actually an electric car that isn't $100,000 and doesn't suck would be great for me. I pay about $3/mo more for electricity because I signed up for "100% Renewable" here. A few places were cheaper, but 100% WIND power and I want Wind/Solar/Hydro/whatever-magic-is-best. I live near a ton of coal plants--15 mile wide city with 13 coal plants IN IT--so I have some interest in clean air. I do accept wood, but we can't generate enough power via wood; even fast-growing pine (and let's face it, pine burns like awesome sauce) requires 1 acre of land to support my house, and I'm not an extremely huge user of electricity.

Now, for my $3/mo or $40/year investment, I pull away demand for roughly 6 tons of coal per year at $1200/year, instead supporting the clean energy industry with my $1200/year. That's a small price for a big impact--I don't mean "It's only 10% of your paycheck" or "It's half as much as your cell phone bill!" I mean I spend more in vending machine junk food 3 times over and have eliminated the cost by being more healthy.

If I move to an electric car... the Nissan Leaf gets 34kWh per 100 miles. It takes me, at 22mpg, about 4.5 gallons at $3.75/gal to drive 100 miles, or $16-ish. At 10 cents per kWh, that's $3.4, which is cheaper for me. Further my 400 miles per month shift my gasoline costs off oil refineries and onto clean energy. The Model S won't be in my price range for 4-5 years though; I won't have my car, mortgage (just bought a house with $3.5% down a few months ago!), and credit cards paid off for 3 years. :|

Re:Bad news for Elon haters (-1)

Anonymous Coward | about a year ago | (#43117383)

In a Romney world, Detroit Motors would be pretty much be gone, Bane Motors would be the new holding company selling off the remnants of Detroit to China and India, and don't even get me started on that Model-S(ocialist) Electric vehicle going on in California; (and I hope Meg Whitman gets to be the gov. of California too, 'cuz back then in time, I didn't know about her and HP). And all the rich people would have so much money they'd have no imaginative ideas left where they should park their money. Everything would be wonderful.

Re:Bad news for Elon haters (1)

ChrisMaple (607946) | about a year ago | (#43117917)

Toyota, Honda, et. al. have successful manufacturing plants in the US. The key is the elimination of featherbedding, corrupt, menacing, overpaid unions (i.e. Obama's friends, at least until he can find a way to stab them in the back, too.)

Re:Bad news for Elon haters (0)

Anonymous Coward | about a year ago | (#43118315)

Elimination? You're a tyrant.

Re:Bad news for Elon haters (3, Funny)

tippe (1136385) | about a year ago | (#43117415)

Elon is suck a jerk! I hear that the batteries he uses in his cars are manufactured from ground up puppies and baby seals. This story is the last straw, and proves that he also has it in for the economy. Can you believe he's going to deny banks and the government an additional 5 years of loan interest? What a douche....

Re:Bad news for Elon haters (0)

Anonymous Coward | about a year ago | (#43117487)

It'll be interesting to see how the reflexive, knee-jerk Elon haters spin this one

It's the reflexive, knee-jerk anti-government types I think will be more amusing. Here we have a company (and potentially an entire industry) jump-started by a government loan, turning out to be a success, and actually repaying the loan. That sort of thing goes against all their beliefs.

Re:Bad news for Elon haters (1)

jo_ham (604554) | about a year ago | (#43117803)

It'll be interesting to see how the reflexive, knee-jerk Elon haters spin this one

It's the reflexive, knee-jerk anti-government types I think will be more amusing. Here we have a company (and potentially an entire industry) jump-started by a government loan, turning out to be a success, and actually repaying the loan. That sort of thing goes against all their beliefs.

They'll claim that early repayment will cost the government money or something.

Somehow they'll spin it in a poor light, it's just a question of how. No knot is too twisted.

Re:Bad news for Elon haters (1)

Rockoon (1252108) | about a year ago | (#43117909)

It's the reflexive, knee-jerk anti-government types I think will be more amusing. Here we have a company (and potentially an entire industry) jump-started by a government loan, turning out to be a success, and actually repaying the loan. That sort of thing goes against all their beliefs.

Oh come off it.. Tesla was doing fine selling the Roadster prior to the government loan. The only reason Tesla got a loan at all is because the government was handing them out to all American auto-manufacturers.

The reason Tesla is succeeding is because they sell everything they make as fast as they can make them, and their profits arent just the cars that they make as they are also selling power trains through both Toyota and Daimler.

And no, the government did not have the moral authority to give a loan out to any auto-manufacturer. Its not like the loans saved Detroit.

Re:Bad news for Elon haters (0)

ChrisMaple (607946) | about a year ago | (#43118001)

Government steals $1e12 from venture capitalists, so they have no money to lend to startups.
Government gives hoards of money to worthless businesses, and by chance $5e8 to a business that appears to be succeeding, while draining off a large portion of the stolen money into government employee wages.
Clueless drones cheer.

Gee, (0, Offtopic)

Kaenneth (82978) | about a year ago | (#43117067)

Thanks Obama.

Re:Gee, (1)

Anonymous Coward | about a year ago | (#43117229)

Thanks for being dragged kicking and screaming all the way to put money back into the civilian economy instead of hoarding it for defense contractors? Sandia? Department of Energy DARPA projects?

We need to put the majority of our money into investments like this and make the entry into manufacturing and engineering low. Make laws that promote open technology and avoid patent trolls.

Re:Gee, (1)

fustakrakich (1673220) | about a year ago | (#43117319)

Make laws that promote open technology and avoid patent trolls.

How do you propose to do that with the corporate puppets in congress? First we have to vote them out, then hope for the best.

I wonder if the government penalizes early payoffs due to the loss of interest on the loan, like some banks do.

Re:Gee, (0)

Anonymous Coward | about a year ago | (#43117343)

Is this like, you put two idiots in a web forum and watch them go at it? I see you've got at least one moderator acting as a cheerleader.

Re:Gee, (3, Interesting)

Smidge204 (605297) | about a year ago | (#43117651)

Do you suppose the money just up and vanishes when the government spends it?

That money goes to individuals or companies, and if to companies then ultimately to individuals via salaries. The point of discussion should not be if government spending is good or bad since, economically, government spending is indistinguishable from any other entity spending the same amount of money on the same things... being "government" does not do anything magical to the money. Rather, the discussion should focus on if the money is spent wisely, for the maximal benefit of the country and its citizens. Obstinately the government is a product of the people collectively organizing their resources for the purpose of serving the public.

Defense spending, as an example, does not appear to have maximal benefit at the amount we are spending. Building battle tanks certainly employs many thousands of people, but we don't need or want battle tanks. Therefore building tanks the army explicitly said they do not want is the military-industrial complex equivalent of paying people to dig holes and fill them in again; money and resources are spent but nothing of real value is created.

On the other hand, spending public money on basic research has extremely high value. Just about everything we enjoy in a technological society has the fundamental principles rooted in government funded research. The DoE should get more funding, not less.

Incidentally, Sandia National Laboratories, like ALL national labs, are part of the Department of Energy. DARPA, on the other hand, is part of the Department of Defense. Just thought you might want that clarified...

So I, for one, have no problem using public money to help a new business developing a new technology with a loan. In the long run, if successful, such a business will pay massive returns in economic activity long after the loan itself is repaid. And even if the loan is never repaid, most of that money ends up right back in the economy anyway since it would have been used to buy materials and pay workers. Unless there was some kind of scam going on, even the worst case is still not that bad economically... and if someone did try to walk off with the cash in their pocket, I'd fully support stringing them up by their entrails in a public square as a cautionary example :)
=Smidge=

Re:Gee, (1)

0123456 (636235) | about a year ago | (#43118107)

being "government" does not do anything magical to the money.

Yes, it does, because the government taking that money and spending it means I work less hard because I know that if I become one of the 'evil 1%', the government will do whatever it can to take all my money.

Certainly there's a level of government spending that is required, but beyond that it's a drain on the economy even if they're taking money from me to spend on things you would otherwise have bought and taking money from you to spend on things I would otherwise have bought.

Re:Gee, (4, Funny)

phantomfive (622387) | about a year ago | (#43117371)

Didn't you read the summary, that it was George Bush? If there was anyone who knew how to pick winners, it was Bush.

Re:Gee, (1)

BasilBrush (643681) | about a year ago | (#43117515)

"Misson Accomplished!"
-- GW Bush May 1st 2003

Re:Gee, (1)

phantomfive (622387) | about a year ago | (#43117659)

Oh yeah, I think I remember that quote. That was when he declared victory of the electric car. Or was that a different one?

Re:Gee, (1)

atrain728 (1835698) | about a year ago | (#43118027)

Apparently people are confused about what the word "mission" means.

Re:Gee, (1)

SolitaryMan (538416) | about a year ago | (#43117529)

The irony of this one is not lost on me.

Headline is a lie (1, Informative)

Attila Dimedici (1036002) | about a year ago | (#43117255)

Tesla has not paid off their loan five years early. All they have done is announce that they INTEND to pay off their loan five years early, four years from now. So, before we jump up and down and talk about how this vindicates the loan program, let's wait and see if it actually happens. That does not mean that this is not good news, but only time will tell if it actually works out.

Re:Headline is a lie (1)

Archangel Michael (180766) | about a year ago | (#43117353)

But Intentions are all that counts. Not results. Unless we need to get better results from under performing, then it means we need more money (but the results don't matter even then)

Re:Headline is a lie (2, Insightful)

Anonymous Coward | about a year ago | (#43117361)

Tesla has not paid off their loan five years early.

The headline doesn't claim they did. So how is it a "lie"?

It isn't, of course. So either you're lying, or you are grossly deficient in reading comprehension. Which is it? Those are your only possible choices, and any other response (including nothing) is an irretractable confession that it's "both".

Re:Headline is a lie (1)

Jiro (131519) | about a year ago | (#43117989)

Everyone with a loan intends to (or claims to intend to) pay off their loan. That is not newsworthy. So announcing it as news implies a newsworthy aspect above and beyond just "they're going to pay off the loan sometime in the future". Typically it means that paying off the loan is a certainty because the only remaining obstacles are procedural ones such as not having some bureaucrat's approval.

Making such a statement when the obstacles are not procedural, and they don't have the money, and the "5 years early" date is still four years in the future, is deceitful, regardless of whether it's literally accurate.

Re:Headline is a lie (4, Insightful)

flimflammer (956759) | about a year ago | (#43117429)

What? The headline is not a lie. It says quite clearly what the future intent is: "Tesla Motors To Pay Off Government Loan 5 Years Early"

Not:
"Tesla Motors Pays Off Government Loan 5 Years Early"
or even:
"Tesla Motors Paid Off Government Loan 5 Years Early"

Re:Headline is a lie (1)

ChrisMaple (607946) | about a year ago | (#43118329)

They are claiming knowledge they do not have.

Re:Headline is a lie (0)

Anonymous Coward | about a year ago | (#43117501)

In related news, I intend to have a three-some with Mary Kate and Ashley Olsen, at some point in the next five years.

But more seriously... I recall hearing a story about Domino's pizza (???? - wikipedia doesn't confirm it). In the early days, their first (and only) restaurant wasn't doing well, so they opened a second one to appear more successful.

Re:Headline is a lie (0)

Anonymous Coward | about a year ago | (#43118263)

If you are reading/quoting/depending on Wikipedia for information, you deserve to be ignorant, as you are.

Re:Headline is a lie (2)

romanval (556418) | about a year ago | (#43117525)

The headline "Tesla Motors To Pay Off Government Loan 5 Years Early" is a statement of intent, not something that already happened. How is that a lie?

Re:Headline is a lie (2)

0123456 (636235) | about a year ago | (#43118039)

"Tesla Motors *Intends* To Pay Off Government Loan 5 Years Early" is a statement of intent. The headline makes it sound as though they're just about to sign the check.

Re:Headline is a lie (1)

romanval (556418) | about a year ago | (#43118217)

They've already paid one year of the loan--- and now they're doing well enough to pay it back in an accelerated rate within 4 more years (rather then 9 more years). I still don't get how that's hard to comprehend.

Re:Headline is a lie (0)

Anonymous Coward | about a year ago | (#43117539)

You are going to die. That is not a lie. But only time will tell how it actually works out.

Re:Headline is a lie (1)

Grayhand (2610049) | about a year ago | (#43117717)

Tesla has not paid off their loan five years early. All they have done is announce that they INTEND to pay off their loan five years early, four years from now. So, before we jump up and down and talk about how this vindicates the loan program, let's wait and see if it actually happens. That does not mean that this is not good news, but only time will tell if it actually works out.

Okay bad headline but can we at least throw the company a bone and give them credit for doing better than expected and it looks likely they will pay off the loan soon when most claimed they'd default?

Re:Headline is a lie (1)

nedlohs (1335013) | about a year ago | (#43117753)

Do you have reading comprehension issues? Or did the editors stealth update the title?

Reads like a press release (5, Funny)

ebcdic (39948) | about a year ago | (#43117265)

Oh wait, it *is* a press release.

Meanwhile.. (-1, Offtopic)

romanval (556418) | about a year ago | (#43117283)

we spent $500 Million A DAY in those proxy oil wars of Iraq and Afghanistan.. and we don't have a hell of a lot to show for it.

Re:Meanwhile.. (3, Funny)

GodInHell (258915) | about a year ago | (#43117355)

Except oil.

Re:Meanwhile.. (1)

Archangel Michael (180766) | about a year ago | (#43117381)

What oil is in Afghanistan?

Re:Meanwhile.. (1)

SolitaryMan (538416) | about a year ago | (#43117565)

Snake?

Re:Meanwhile.. (1)

BasilBrush (643681) | about a year ago | (#43117569)

This oil:

"Afghanistan has 3.8 billion barrels of oil between Balkh and Jawzjan Province in the north of the country.[40][41] This is an enormous amount for a nation that only consumes 5,000 bbl/day.[42] The U.S. Geological Survey and the Afghan Ministry of Mines and Industry jointly assessed the oil and natural gas resources in northern Afghanistan. The estimated mean volumes of undiscovered petroleum were 1,596 million barrels (Mbbl) of crude oil, 444 billion cubic meters of natural gas, and 562 Mbbl of natural gas liquids. Most of the undiscovered crude oil occurs in the Afghan-Tajik Basin and most of the undiscovered natural gas is located in the Amu Darya Basin. These two basins within Afghanistan encompass areas of approximately 515,000 square kilometers."

Unfortunately:

"In December 2011, Afghanistan signed an oil exploration contract with China National Petroleum Corporation (CNPC) for the development of three oil fields along the Amu Darya river."

Oops! All those American lives lost and China gets the oil.

http://en.wikipedia.org/wiki/Mining_in_Afghanistan [wikipedia.org]

Re:Meanwhile.. (0)

Anonymous Coward | about a year ago | (#43117599)

None that I know of. One theory is that they want to build a pipeline through it though.

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

Re:Meanwhile.. (0)

Anonymous Coward | about a year ago | (#43117945)

Opium.

Re:Meanwhile.. (0)

Anonymous Coward | about a year ago | (#43117505)

Afghanistan is a proxy lithium war.

Soon enough we will be having proxy potash wars.

Re:Meanwhile.. (0)

Sparticus789 (2625955) | about a year ago | (#43117613)

we are spending $1.2 billion A DAY for Obamacare.. and we don't have a hell of a lot to show for it.

FTFY

Obamacare does not fully begin until 2014 (1)

bussdriver (620565) | about a year ago | (#43118041)

I am opposed to "Obamacare" but you are full of shit.
Pulling numbers out of Fox's ass/mouth again?

It is not even fully implemented yet so the impact can't be realized; even then, you have to use the system before/after to notice any change - so right there that rules out most people and makes it easy to appeal to people's ignorance and gullibility.

Obamacare doesn't solve the drug cost problem, it doesn't solve the 30% of all costs being wasted by the insurance "industry" but it doesn't make those problems worse either. That is why it was able to pass at all. It can't be blamed for rising costs - it never was allowed touch the real problem (like every other problem of today.)

The wars kill people and screw up many more people with unpredictable blow back, not to mention how many Americans it negatively impacts. When more of the military dies at their own hands than by the enemy; you have to ask yourself, who is the real enemy?

Re:Meanwhile.. (0)

Anonymous Coward | about a year ago | (#43118125)

I dunno, my health insurance costs went up 10% this year(yet inflation was 2% in 2012...), surely this Obamacare thing is starting to work.

But . . . (0, Troll)

Anonymous Coward | about a year ago | (#43117305)

But . . . but . . . but . . . Teh Socialism!11!!111

And what are the others doing with it? (0)

Anonymous Coward | about a year ago | (#43117455)

Ford's got a piece of junk you kick regularly, Nissan hasn't said anything, and Fisker likewise.

So now... (-1)

Anonymous Coward | about a year ago | (#43117541)

Instead of using my money, educating my kids, they lend the money to Tesla - whom then will pay it back for my grand kids can get an education at three times the cost?

Well done Tesla....

Long trips (1)

websaber (578887) | about a year ago | (#43117645)

They should make a long trip adapter like a generator that you tow behind you or strap on the roof that takes gas. I think that would really widen the cars appeal.

rent a car for long trips (1)

Chirs (87576) | about a year ago | (#43117713)

If you spend most of your time doing short trips, and occasionally do long trips, it makes perfect sense to rent a car for the longer trips.

I lived for multiple years owning no vehicle...I could bike to work (or bus in the winter) and on weekends I could rent a small car for $15/day. Hard to beat that.

Re:rent a car for long trips (0)

Anonymous Coward | about a year ago | (#43117837)

If you spend most of your time doing short trips, and occasionally do long trips, it makes perfect sense to rent a car for the longer trips.

So you're going to pay $100,000 for a 'luxury' car that you then drive to and from the shops down the road?

I guess there's a market for something like that, but it's probably not a big one.

Re:Long trips (1)

Anonymous Coward | about a year ago | (#43118087)

I have a better idea. How about doing something more eco-friendly like putting a wind turbine generator on top of the car? That way when it was driving down the the road it could also be charging its battery.

With a system like that it would have a virtually unlimited range, right?

Government strategic investments (0)

Anonymous Coward | about a year ago | (#43117683)

Great success! I would like to drive one! Compared to venture capital success rate of 10%, I think that the government success rate in industrial strategic investment is actually good. Anyone has numbers on this? Note that this is how many of the Canadian, Asian and European new technology ventures succeed and kill American industries. Look at the Chinese subventions to solar technology as a fresh example. As the US share of the world economy is shrinking, we do not have to be the perfect capitalist example anymore. It is time to play the game like the others and start helping strategic breakthrough enterprises.

eh hang on (1)

DaveGod (703167) | about a year ago | (#43117729)

If the loan was at an expensive interest rate or included specific terms for what it could be used for, then being able to repay the loan early is good news for Tesla and anyone with an interest in their success.

However if this was a cheap loan that was not tightly restricted, its an odd choice to repay cheap finance early. Didn't Tesla have anything good to put the cash on?

Re:eh hang on (1)

jo_ham (604554) | about a year ago | (#43117881)

If the loan was at an expensive interest rate or included specific terms for what it could be used for, then being able to repay the loan early is good news for Tesla and anyone with an interest in their success.

However if this was a cheap loan that was not tightly restricted, its an odd choice to repay cheap finance early. Didn't Tesla have anything good to put the cash on?

It's good PR, whether it was cheap or not.

They could buy marketing with it, or they could use the early repayment as good PR about how well they are doing.

Re:eh hang on (1)

Intrepid imaginaut (1970940) | about a year ago | (#43117933)

Yeah this is what I was thinking. It's not neccessarily a smart accounting move to pay off your loan early, and usually comes with an opportunity cost. I however am not Elon Musk, so... good I guess?

And this is why DOE needs to be defunded (0)

ValentineMSmith (670074) | about a year ago | (#43118021)

The US Government has no business playing venture capitalist to Elon Musk or anyone else. The power to act give loans to business ventures is NOT in the powers enumerated in Article 1, section 8 of the Constitution. So, they went to the executive branch instead, and managed to get some money from DoE's slush fund. If they want money, they should be doing it the old-fashioned way: going to REAL venture capitalists, selling common or preferred stock, or raiding Elon's piggy bank. I'm happy that they're gonna pay back the loan 5 years early, but that doesn't change the fact that the loan should never have been made in the first place.

Re:And this is why DOE needs to be defunded (1)

romanval (556418) | about a year ago | (#43118367)

Musk put up $70M of his own money, as had to bust his ass to gather up financing from many others friends and investors, since traditional investors stayed away from his companies since they were brand new and had no track record.

Meanwhile, the US bailed out a LOT of very established banks/mortgage/insurance/autos manufacturers, and each of them got WAY more money then a paltry $465M, and much of it was not a loan.

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