New York Times writer opposes DOE loans for Tesla
A bit of an online dust up has sprung up between the New York Times' Randall Stross and Jason Calacanis. Stross published a column the other day opposing Tesla Motors' application for low interest loans from the Department of Energy under the Advanced Technology Vehicle Manufacturing Incentive Program (ATVM). That money would be used to fund development of the Model S sedan and construct the factory to build it. This is exactly the kind of thing that program was designed to fund. Calacanis, as a new owner of a Tesla Roadster and friend of CEO Elon Musk, is of course none to pleased with Stross. Stross's main thesis is that loaning money to a startup EV company would not be a good investment since the technology is not evolved enough. That is ridiculous on the face of it. While Tesla has made plenty of mistakes along the way to delivering some Roadsters, they do appear to be learning lessons from those errors.
On the flip side, Calacanis is no stranger to a bit of hyperbole himself. It's not clear that a Roadster would only cost 1/3-1/2 as much just by lowering the range to 100 miles and while the Model S will certainly be less expensive, $60,000 is still not what I would call an affordable car. However, it's a big step in the right direction. While Silicon Valley has a remarkable record of innovation, it remains to be seen if they have all the answers to the world's transportation problems. Considering the 100s of billions being flushed down the toilet of Wall Street, a $400 million loan (with interest and everything) to Tesla should be a no brainer.
Gallery: Jason Calacanis' Tesla Roadster
[Sources: New York Times, Jason Calacanis]
Reader Comments (Page 1 of 2)
Jo 2:51PM (12/01/2008)
Agree 100%. A $400 million loan to Tesla is a much better investment than $10+ billion (BILLION!?) to GM.
Reply
Dave 5:40PM (12/01/2008)
Given current technological and economic realities, the Volt makes far more sense than anything Tesla has proposed.
In fact I'll go out on a limb and say that it makes at least 25 times as much sense (10 billion divided by 400 million)
Tohe 6:18PM (4/11/2009)
@Dave
Of course you wrote this before the Model S announcement and the revelation of the partnership with the Smart car. Rome wasn't built in a day you know.
GenWaylaid 3:20PM (12/01/2008)
"$60,000 is still not what I would call an affordable car."
In Silicon Valley, surrounded by homes that cost over $1000 per square foot, I'm sure it sounds quite affordable.
Reply
Lad 3:31PM (12/01/2008)
Boy what a mess! All caused by the last eight years of the Republican warped definition of free enterprise without regulation and oversight; and then the Congresses' idea of picking winners and losers by offering tax payer loans at low interest to selected companies, gambling that the loans will be paid back...fat chance.
So where do we go from here? Is this the last nail in the coffin of our Republic before our government starts going socialistic? Or, has it been happening right-along under the cloak of the industrial/lobbying system? Ever tallied what we have paid the il companies in subsides?
Reply
Joshua Brown 3:40PM (12/01/2008)
Bailout money is being practically forced onto banking institutions, but the automotive industry is being grilled even though their combined request only add up to a fraction of the $700 billion.
Almost every major American corporation has achieved success through government help in some form or another. This hold true for the Big 3 as well. Tesla should be given the same opportunities now in its infancy.
And, if Tesla shouldn't be eligible for funds from the ATVM Incentive Program, then who should?
Reply
Woodenbee 3:35PM (12/01/2008)
When are people going to start their so called opinions with a simple agenda statement, it should be required of all pundits, contributors, and reporters, when you write an article because someone has paid you too or express an opinion based on anything other than a genuine interest or concern you should be compelled by law to reveal your true motives and agenda, I'm so sick of having to listen to paid mouthpieces interrupt constructive genuine discussion with their blatant and amoral distortions/arguments/ talking points. It's so pervasive and as usual is tolerated and welcomed under the guise/mascarade of opposing opinion or "devils advocate" its just another tactic to muddy the waters and delay change or progress and I'm sick to death of it. These people pervade our television, radio, politics and now apparently our newspapers, where does it end? they are just a mutation of lobbyists and should be regulated as such.
Reply
Jo 4:31PM (12/01/2008)
Huh?
fnc 7:16PM (12/01/2008)
Free speech dude.
I'd MUCH rather live in a country where I can hear opinions from every unqualified asshole out there than in one where only filtered speech from 'approved' speakers is allowed to get to my eyes and ears.
radler63 5:46AM (12/02/2008)
Does anabody have practical experience with operating a cell phone battery powered vehicle? I have now approx. 700km on LiFEPO4 cells and well, no wonder batteries allways have their weaknesses in the cold - but so far no big problems.
My wishes for the money poured into Tesla- head for some vehicle for daily use and low total cost of ownership. This means battery standardisation is first before I would draw the plug for the big funding...
Reply
Woodenbee 3:48PM (12/01/2008)
The real reason they have these right wing plants on news/media discussion is the media/ tv channels are so terrified of appearing to agree with these educated, qualified left leaning experts they have to wheel on some paid neo con lobbyist to spout his pseudo logical, non sensical, talking point drivel to assure the base that all their fantasies still hold water, in spite of reality. You can always spot them, they're the one blinking a lot, kinda sweaty, balding and sure has a lot to say, especially when anyone else is making sense.
Reply
Jo 4:32PM (12/01/2008)
Amen, brother!
Although, sometimes I think they bring those nuts onto the shows to illustrate just how creepy/nutty some of their views really are!
why not the LS2LS7? 4:32PM (12/01/2008)
If you cut the battery to 40% and got into larger production, I think you could cut the price by 40%, maybe 50%.
But without a "A Better Place" type charging infrastructure, 100 mile range is a deal killer. Also, if you make the vehicle bigger (like the Model S), the range will drop again, due to lower efficiency of larger vehicles.
The idea that the technology is evolved enough is itself ridiculous on its face. This comes back to what you said a couple days ago Sam. You said (facetiously) that Tesla has changed nothing since they came out.
Well, what have they changed?
I cannot see why we should give a loan to Elon Musk. He's got enough money to play with rocket ships, he can build an auto plant.
Giving loans to money-losing companies (like Tesla) is a risky proposition. I cannot see how $400M is nearly enough. They just secured $40M more in funding, and that doesn't cover ANY capital improvements.
Reply
Richard 5:45PM (12/01/2008)
"Giving loans to money-losing companies (like Tesla) is a risky proposition."
And giving money to GM is what? Aren't they losing money as well? In fact, they are losing more money than Tesla. And, they don't have any alternative fuel vehicles for sale. Tesla does. Tesla's case is that they need money to bring to new model to market. GM's case is they money to pay for private plane trips, sports sponsorships, and fat CEO paychecks. I think that's a bad decision!
Herkimer 6:13PM (12/01/2008)
I'd like to disagree with your statement that a "100 mile range is a deal-killer".
There are a lot of folks who don't take many 100+ mile trips. Certainly not for 95% of their trips.
why not the LS2LS7? 7:58PM (12/01/2008)
Richard:
Tell me where I said giving money to GM was a good idea.
Herkimer:
You're absolutely right, this car will satisfy people's needs 95% of the time. Exactly as Ed Begley, Jr. says in "Who Killed the Electric Car?"
But the problem is people aren't interested in a 95% solution. For starters, that would leave them with a vehicle that won't meet their needs 5% of the time (21 days a year). But beyond that, people just expect to buy a car that meets or exceeds their needs, not almost meets it. And the more they pay, the more they expect this.
jake 1:38AM (12/02/2008)
Actually they have an ace up their sleeve, they are waiting on another separate $150 million DOE loan which will be going mostly to the construction of the Model S factory, pending environmental approval.
Add the $400 million and that should be enough to get the Model S production going along quite well. Tesla actually stands a good chance of qualifying for the DOE loans we are currently discussing. Anyways DOE will be doing an assessment of Tesla's plans for using the money just like they did the previous loan, so I'm not too worried about Tesla getting the loan without a reasonable expectation of profitability.
Still patiently waiting for them to show their progress on the Model S.
Don't Donate to the madness 2:01AM (12/03/2008)
I would not give Tesla one thin dime.
Elon Musk and committee do not deserve the funds due to their mis management of this company. I thought Elon had enough money to fund this venture himself? Isn't that why he booted 40% of the company?
Snap out of it you all.. and get a grip.
I worked there... It's a dying venture.
Reply
texmln 10:39PM (12/01/2008)
Weren't you the same people crying and whining about ethanol being unable to support itself and requiring subsidies to stay in business? So, now that it's YOUR pet project unable to support itself taxpayer subsidies are magically OK? How about some consistency?
Reply
jake 12:57AM (12/02/2008)
People are crying because they feel it doesn't make much environmental sense and because EV infrastructure doesn't get nearly as much money as ethanol does (not even sure if there are any subsidies for EV infrastructure like charging stations or batteries). If every project got the same money people wouldn't be complaining, but with limited funds people will be fighting over it.
Same thing with Tesla Motors. Tesla Motors is in a good position to qualify for this loan given they are using it to build their next sedan and their previous EV parts project. But in comes the Detroit 3 wanting a large part or maybe even all of the $25 billion that was part of this program, meaning Tesla stands to lose a good chunk or even all of their possible loan. Of course Tesla will complain.