TESLA REPAYS DEPARTMENT OF ENERGY LOAN NINE YEARS EARLYThanks to Troubadour for reminding me to include this clip:
ONLY AMERICAN CAR COMPANY TO HAVE PAID BACK GOVERNMENT
WEDNESDAY, MAY 22, 2013
PALO ALTO, Calif.-- Tesla Motors announced that it has paid off the entire loan awarded to the company by the Department of Energy in 2010. In addition to payments made in 2012 and Q1 2013, today’s wire of almost half a billion dollars ($451.8M) repays the full loan facility with interest. Following this payment, Tesla will be the only American car company to have fully repaid the government.
For the first seven years since its founding in 2003, Tesla was funded entirely with private funds, led by Elon Musk. Tesla brought its Roadster sports car to market with a 30% gross margin, designed electric powertrains for Daimler (Mercedes) and had done preliminary design of the Model S all before receiving a government loan.
In 2010, Tesla was awarded a milestone-based loan, requiring matching private capital obtained via public offering, by the DOE as part of the Advanced Technology Vehicle Manufacturing program. This program was signed into law by President Bush in 2008 and then awarded under the Obama administration in the years that followed. This program is often confused with the financial bailouts provided to the then bankrupt GM and Chrysler, who were ineligible for the ATVM program, because a requirement of that program was good financial health.
The loan payment was made today using a portion of the approximately $1 billion in funds raised in last week’s concurrent offerings of common stock and convertible senior notes. Elon Musk, Tesla’s Chief Executive Officer and cofounder, purchased $100 million of common equity, the least secure portion of the offering. “I would like to thank the Department of Energy and the members of Congress and their staffs that worked hard to create the ATVM program, and particularly the American taxpayer from whom these funds originate,” said Elon Musk. “I hope we did you proud.”
Tesla Motors' (NASDAQ: TSLA) goal is to accelerate the world’s transition to electric mobility with a full range of increasingly affordable electric cars. California-based Tesla designs and manufactures EVs, as well as EV powertrain components for partners such as Toyota and Daimler. Tesla has delivered almost 10,000 electric vehicles to customers in 31 countries.
Update: Thanks to doc2 for reminding me that Mitt Romney also trash-talked Tesla last year (boy, that asshole sure did have a grudge against American car companies, didn't he? Wonder if that's a substitute for anger towards his father the auto executive???)
Anyway, here's more:
Tesla Repaying Loan for ‘Losers’ Gives Obama Green Win
Tesla Motors Inc. (TSLA), labeled a “loser” by Mitt Romney during the U.S. election, is giving President Barack Obama’s green-energy strategy its biggest win after almost two years of failures pounced upon by Republicans.
The maker of the electric Model S car as early as today will become the first recipient of a U.S. Energy Department vehicle loan to pay off its debt. The Palo Alto, California-based company will do so nine years ahead of schedule, with taxpayers making at least $12 million on the $465 million lent.
Tesla’s payoff may quell critics who said Obama shouldn’t have acted like a venture capitalist in picking green-energy companies to receive government loans and grants. Republican lawmakers have held up the bad bets made on plug-in carmaker Fisker Automotive Inc., its battery supplier A123 Systems Inc. (AONEQ) and solar-panel maker Solyndra LLC as examples of rewarding untested companies for political reasons.