graham

Interesting counterpoint to the Stross article. A different NYT article mentioning that lots of small companies are vying for part of the $25 billion ATVMP including Tesla. Merely facts stated, with less editorializing:

http://www.nytimes.com/2008/12/02/bu...1&ref=business

just-an-allusion

The point that I think you're missing is that the so-called "Big 3" got themselves into the financial mess they are in today due to ignoring environmental necessity, consumer demand, governmental dictates, as well as employing shoddy workmanship providing a sub-standard work product even though they had all of the best materials and the largest labor force non-par, and just overall poor business practices.

"Bailing" them out would only provide them with the opportunity to prolong the malaise and temporarily stave off the inevitable, long needed restructuring from the top down, not to mention providing the upper level managerial staff with some well padded retirement/severance packages, as well as divert predetermined funds from the intended industry applications.

Simply put, they got themselves into this mess on their own accord, through their own machinations and mismanagement practices, they should be able to get themselves out...being unable to is demonstrable of their inability to not only manage their business, but also to provide a market/consumer viable work product, i.e., failure.

Basic, simple common sense teaches us that we don't throw good money after bad...Now what was that about "self-serving"??

vfx

Any good investment portfolio is diversified into many sectors. I blame the US D3 for not even having one "Prius" in their lines.

Make your Hummers but keep your EV1 too.

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The world loves to be deceived.

stopcrazypp

How Risky Is Tesla’s Bet on a DOE Loan Guarantee? Earth2Tech

More details on the DOE loans. Looks like Tesla needs the new $400 million loan if they want to have a good chance of progressing in Model S on time. The $200 million DOE loan guarantee might come too slow and Tesla isn't the first in line to get a guarantee.

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graham

This is a good article, thanks dpeilow! It explains a lot of the details of the different loans and where Tesla stands with them.

If I am reading it correctly, Tesla is in good position to get the $200 million loan (as part of the $4 billion 2005 package) but there are still hurdles to obtaining it (famously, the environmental impact delay in building the manufacturing plant) and the bureaucracy involved might delay disbursement to Tesla beyond the time table (late Spring/ early Summer) that Tesla has been hoping for.

The $400 million dollar loan (as part of the 2007 $25 billion package) is more of an unknown, but is a backup plan in case the $200 million either falls through or is delayed. The $400 million loan has more favorable terms than the $200 million but it is unclear at this point what Tesla's chances are in obtaining it, or what timeline it is offered.

Considering the other car manufacturers want part of the 2007 $25 billion as a quick bailout, it seems like Tesla has a shot at getting that money quicker than the 2005 $4 billion. Either way, I hope both loans work out for Tesla, and quickly. I want the Model S on the road soon.

doug

The Motley Fool: One More Reason We Shouldn't Bail Out Detroit
SFGate: Auto bailout consequences

doug

Opinion: Why Congress shouldn't divert funds to Big Three - San Jose Mercury News

Chris H.

$57,500 for the Model S... This looks like a price drop.

Elon is nothing if not transparently self serving. However, I do agree that the D3 should keep their money-grubbing paws off the ATVMLP.

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just-an-allusion

graham

And puts it right at $50,000 with the Federal tax break. $45,000 for Californians if they can extend that tax break beyond Mar 31. $45,000-$50,000 for a Model S (along with guaranteed commuter-lane capability) is pretty compelling.