Tesla Repays Government Loan Faster Than Planned
A few weeks ago, the news jumped on Tesla Motors, and especially Elon Musk telling Detroit that they had lost the game when it comes to electric cars. While this might just be another brash comment on Musk’s part, taunting Detroit is not a very positive thing to do and ultimately doesn’t do much to push electric cars out the door. You can read our original story here: Tesla Makes Fun Of Detroit.
Since then, Elon Musk explained the loan misunderstand in a blog post, as David Herron wrote about last week in his article:
This clarified the situation, which again proved to be greatly exaggerated and over-amplified in the mainstream news media.
Having said this, the last few weeks’ events have shown Tesla could have more cash reserve then it leads to believe. Indeed the Californian electric carmaker is making its first payment early by the end of this month instead of December. The Department of Energy, DoE will be paid back earlier on the $465 million loan, yes loan and not grant, the startup received to engineer and produce the Model S sedan. The DoE requested a faster repayment schedule by Oct. 31, which Tesla was quoted as being happy to oblige.
Tesla Pays On Time. In fact, according to Bill Gibbons, a DoE spokesman: “Tesla continues to make loan payments on time and in full” Aside from political manipulations, of which so far we have seen too many in this deplorable presidential election, these loans went to many companies, including Fisker Automotive, Ford and Nissan, create in 2008 by the last Bush administration. The round of loans was designed to help the U.S. better compete in the new market for highly fuel-efficient cars and trucks. It was only then that the current administration disbursed the funds and set an optimistic goal of having 1 million electric vehicles on U.S. roads by 2015.
What If Tomorrow Romney Is President? This is the white elephant in the room and many electric carmakers are wondering what would happen to the current buyer incentive programs and loans alternative energy companies receive. According to Musk, a Romney victory would have a minor impact, since he feels electric vehicles have gained such momentum.
With Goldman Sachs Group Inc. pumping $192.7 million in the electric car company, Tesla could receive up to $221.6 million if the underwriter exercises its option to purchase additional shares in full. This means these extra funds will act as “risk reduction” according to Elon Musk. In the meantime, Tesla strikes a high score by paying part of its Department of Energy loan two months early.