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Tesla on ABC World News Oct 25th, 2011...

I just caught a story on ABC World News tonight about government grants to green tec companies, and they brought up Tesla and Karman Fisker. The interviewer questioned Tesla VP Diarmuid O'Connell, with regard to their SEC filings stating that they "expect continuing losses for at least the forseeable future", and if they don't make a profit, they might not be able to pay back those government grants, to which Diarmuid responds, "...well, we will make a profit".

Personally, I would have put FAR more money into Tesla, over GM, because GM is a JOKE! Their business model is bound to fail again, because they are thinking backwards, and not forwards.... Big unions, poorly built cars, weak designs, no future vision. I have only seen a couple of their new hybrid EV cars on the road, and they are not much to look at. Otherwise, their big commercial push is the new 300, with a former hip-hop artist plugging how Detroit is now cool, etc. Seriously? Who do they think they are kidding? Detroit is a cesspool, and no one I know thinks of 'cool' when the word Detroit is mentioned, but rather $100.00 delipadated homes, in drug infested neighborhoods.

The FACT is, Tesla is new, fresh, innovative, and built in America with the kind of brilliance that made Apple Computers the BIGGEST company on the planet!
I know it's a risk starting a car company in America, because the big three automakers here don't want anyone else to make the look worse than they already do, but seriously, they should be embracing Tesla, because once the Model S hits the market, they all know dam well, they will be doing everything they can to jump on the bandwagon with something that looks just like it.

FYI - That was Chrysler, not GM.

Fisker's Federal Fiasco: Loans, 20-MPG Electric Cars, Shoddy Reporting

In this politically charged climate it is "news" to second guess the initiatives to encourage clean energy industries. Of course its not news to question the wisdom of continuing tax incentives to oil companies making obscene profits.

Larry

Sorry, Chrysler... GM, all their cars look the same to me. Cheap junk circa 1975.

Larry - You bring up a very good point. Oddly, the so called "liberal media" is reporting the heck out of these so called 'green' loans. And, by the by, they are in fact loans. But are they spending much time reporting the BILLIONS of dollars the oil industry gets? Nope. In fact there are a lot of things the government invests in, or makes loans to, but the liberal media seems to be heavily focused on the 'green' loans. Odd.

Larry ...... "making obscene profits" and causing catastrophic environmental disasters and pollution.

Mscottring, I agree! I think there is a lot of pressure on any green loans at this point due to the bankruptcy of that solar company that Pres Obama visited his first year in office. Plus all the speculation that Tesla is just another DeLorian (sp?)

TikiMan, the spelling is DeLorean, but I think you may in fact be referring to Solyndra in this context? BTW, DeLorean is discussing an electric model... Now that's history overtaking itself! ;-)
http://www.greencarreports.com/news/1067470_all-electric-delorean-dmc-12...

Re: Media reporting

It's not that the media is liberal or conservative. You're just surprised that liberal media is reporting "against" green topics. Media in the USA comes from advertisements, more money from advertisements comes from splashier "news". If there's no news (e.g., gas companies getting the same old same old is not news) they have to exaggerate something till it sounds like news. Got an hour to fill, you know, ads to push.

While there's always some truth to these things, you can't get too excited at our news. You never know whether the real story is interesting or not.

I say this from personal experience. My local media tried to make a negative story about me once. Had I explained the truth, and how there was nothing to the story, they would have had no choice but to pick and choose my words to make the story better!

So if you want good advertising, just make sure the media can make a positive story about you. They're very creative people, and listeners trust them.

Volker,

Thanks for correcting me on the spelling. However, I am in fact referring to DeLorean.
Mr DeLorean left GM back in the mid-late 1970's to build his own car company using major government grants. His vision was to build a futuristic sports-car, that even a middle-class executive could afford (at the time there weren't any cool mid-priced sport cars). He was almost constantly reported about in the media, and there were many skeptics if his car and company would be successful.
Needless to say, he was set up to fail, and then literally set-up by the FBI to destroy his credibility, family, and life as he knew it. I am sure GM had a BIG hand in this, as they couldn't have someone messing with the big three.

I suspect Tesla is going to be up against some very similar attacks, and I would not be surprised if GM is currently paying huge amounts of money to various groups to try and destroy Tesla.

TikiMan, thank you for the additional details. I did not know the full story but it makes me curious. I should go an read some more about the DeLorean case, when time permits.

I don't think the government should be subsidizing businesses in any way shape or form. We have a government to protect our safety and empower prosperity, not conduct social engineering and venture capitalism.

Tesla, GM, and every company, needs to stand on it's own two feet. If Tesla is truly that great, they will attract sufficient private investment. If private investors aren't interested enough to fund a company, why should the taxpayer have to?

jfeister, you'll never get a new tech automotive manufacturing plant without the gov't loan guarantees. It's just far too much capital required for too great a risk. So we would be stuck with the same old stodgy GM, Ford, and Chrysler dinosaurs.

Normally I would agree with you. But I would MUCH rather the gov't do some economic stimulation by investing loans in new technology than in buying up bonds with cash like the Fed did.

In fact, I wish more had been spent on fixing our infrastructure rather than buying up US bonds. At least then we'd have some solid bridges, highways, and electrical grids to show for it.

Yes, Solyndra went belly up and Fisker turned out to be an embarrassment, but you can't win on every investment. You have to play the odds.

IIRC, Tesla said they would be doing mostly the same stuff without the loans. Taking the loans was a no-brainer, and the loans shortened the schedule for delivery.

@jfeister, ATVM loan is not subsidies or bailout money. It is good business for government which just accelerates tech development and creates jobs and stuff in US, instead of making people buy things outside. As it is good business to government it is good business to taxpayers too.

Started at Bush administration, continued at Obama administration.

https://lpo.energy.gov/?page_id=43

Note that GM did get bailout money. It's completely different thing than ATVM loan. Also oil business gets a lot of subsidies, way more than any "green" tech.

To be fair, jfeister is against the loans to GM et al as well, and probably for the oil companies also. If only he were king. :)

That said, all this news mongering about Solyndra and Fisker really ticks me off. They don't mention the literal billions that GM and Ford got and the definitely don't mention all the many billions in subsidies and protection, (not loans), for the oil business.

I bet if they increased the price of gas at the pump to actually cover the true cost of delivering it, it would be $10/gal or more! And that's not even counting the environmental externalities that can't really be calculated.

I have nothing against government doing smart business. That's capitalism in its purest form, even government is doing profit, but because that all comes back to taxpayers in one form or another it's like taxpayers would be making money with programs like that.

I wonder how much gallon of gas would cost in US without subsidies...

@Timo - That's right. The Government has been doing this for 100+ years. Loans and gifts. Every tax deduction you can claim is a gift. It's tax revenue the Govt forgoes. Don't have to pay it back. Loans are loans. Are the naysayers ready to give up all the loans and gifts, or just the ones that don't benefit then? How about the low interest student loan their kids will need for college?

Volker,

Here is a video link to the whole story about John DeLorean and his car company... http://video.google.com/videoplay?docid=8295574887775056318#

Complaining about government subsidizing businesses via loans is ridiculous. The government helps subsidize all businesses by paving the roads so people can reach the business, installing traffic controls so they can reach it safely, providing infrastructure for public water and sewage so the business can have a bathroom, paying for primary education so the populace is educated enough to work at the businesses, providing electrical infrastructure to power the businesses, public sidewalks so people can get to your business, public lighting so the customers aren't mugged in the dark, and the list goes on, and on.

Businesses get a huge helping of subsidies in all sorts of less than visible forms. Complaining because the government is handing out that last few dollars for actual capital investment is disingenuous at best.

Unless you're going to go full anarchist and advocate having no government paid roads, lighting, no schooling, no sewers, no sidewalks, absolutely no government funds that could remotely contribute to any businesses success?

@ckessel
Well put!
(warning: message sent via government subsidized infrastructure)

ckessel,
I don't think jfeister is referring to government monies for socialized government services (i.e. roads, traffic lights, police, fire-rescue, etc public services), but rather government subsidies and loans given to privileged private sector corporations (most of which have powerful DC lobbyist that can sway our democratic system in their favor).

In the case of Tesla, I think it is a good thing our government is loaning monies to such a forward thinking company which will not only promote new American jobs, but also decrease pollution, and our ever-growing need for more foreign oil (much of which comes from terrorist sympathizing nations, and or greedy US oil monopolies), thus decreasing our need to constantly be involved militarily in these regions of the world.

However, on the flip side, I don't believe in our government should be handing out subsidies and loans to greedy backward thinking corporations and monopolies that don’t play by the rules of a true ‘free-market’ democracy, just because they have an inept and out-of-date business model (such as GM).

The same goes with corporate ‘farm subsidies’, which do nothing to help small struggling farmers, but rather just drives them to sell their farms to greedy corporations, whom take the monies to squander on their personal elite luxury lifestyles, and promote under-wage illegal jobs for poor immigrants, thus further driving the small legitimate farmers out of business for good!

Stop holding back TikiMan, tell us how you really feel. :-D

Is it possible to lose our deposit money if Tesla goes bankrupt? My wife is concerned as am I.

Andrew - I am by no means an expert on the issue of bankruptcy litigation. But I believe the answer is yes, you could lose your deposit if this, or any company you made a deposit with, goes bankrupt.

It's an investment in not only your spot in line for the Model S but your confidence in the company. Every startup company is in the red to start out and makes money with time, Tesla Motors is the first American Car company to go public in how many years??? I have seen enough to be confidant in my $5k investment as well as an investment in the companies stocks as well.

Andrew18, Don't be frightened off by these 'status quo' bought and paid for morons! Mitt Rummy would tell you that eating vegetables is bad for you right about now, if Pres Obama supports it.

The reality of it is; Tesla has been working diligently for many years leading up to this car. The roadster was merely ‘proof in the pudding’ that they COULD do it when no one else could (and they DID!) There is no denying it, starting a car company is about like starting up a big oil company. However, Elon Musk is NO John DeLorean or Preston Tucker, anymore than the ‘Tesla Model S’ is a DMC-12 or Tucker 48.

Besides, I am sure GM, Ford, and Christler all have BIG FAT checks going out to him as I write this.

Sometimes revolution requires risk, and I for ONE am willing to be part of the electric car revolution!

Andrew, yes, you can lose the deposit. I asked before depositing mine and was told it's part of Tesla's operating capital and in the event of bankruptcy we'd be there along with all other debtors. I figured odds were slim I'd lose it, so I put in my deposit anyway.

And the money I've lost in my stock account in the past 6 months is way more than my $5k deposit. I've got about $10k in TSLA, and even that combination is less than my other stock has gone down. Fortunately it (the stock market) has been going up for the past few weeks. Hopefully it'll continue to do so for a few more months. Nobody knows for sure.


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