Tesla Is Going Public
wired.com
wired.com
Now Tesla insiders are leveraging that taxpayer loan to IPO.
Is this free enterprise or just corruption?
B) Compare that number with the inflation-adjusted amount that the government has put into other research ventures. Like, say, THE INTERNET.
C) Tesla says that it is now profitable http://www.techcrunch.com/2009/08/07/tesla-says-it-is-now-pr....
What's your problem with better technology here?
There is a huge difference between government funding for basic research, and government funding to bring a privately owned product to market.
Even worse, since Daimler is a Tesla shareholder, U.S. taxpayers are underwriting tech that is partially owned by a foreign competitor.
So, yeah, we're on the hook for 500m. But we just spent a trillion in Iraq. And when we hit peak oil and hit a point of total supply inelasticity for energy, we're really gonna be up a creek.
There are literally thousands of companies that get these loans. I invested in one called Beacon Power, they build electrical grid stabilizers based on flywheels -- suck in excess power during supply peaks, then spit it back out if everyone turns on their AC units at once. Great idea. Helps the whole economy if they succeed, not just them. So the dept of energy took the long view and threw them a few million dollars as a loan.
All in all, this stuff adds up to way less than 1% of domestic federal spending -- which itself is less than 1/6 of the total federal budget. If a few of them pan out and we reduce our dependence on foreign oil, then it's a win.
Just speculating, of course. But I'm assuming they somewhat know what they're doing, given that they actually built the thing and it actually works. Gotta give them some benefit of the doubt for that.
Another speculative data point, a vehicle like this, the engineering is a much bigger % of the final cost than your standard "build what we built last year" car.. that has to come into the decision as well.
I'd much prefer my tax dollars subsidizing my car than subsidizing cheap fishing and agriculture.
Could you cite your sources please.
The SEC filing provides the first clear look at the company’s finances. It notes that Tesla has lost "approximately $236.4 million from our inception through Sept. 30, 2009"
I can't even imagine the amount of effort and capital required to pull something like this off. If anything, I'm surprised how well they're actually doing so far.
Musk (its CEO) had mentioned that Tesla would be profitable in 2009, and that's clearly not the case. Stating that losing $240 million in 8 years is doing "extremely well" is irresponsible to impressionable investors looking forward to Tesla's IPO.
Tesla sells cars. After building them. For more than it cost to build the car. That's a business model.
And they're profitable as of this year, as I cited above, and you keep refusing to acknowledge.
2. Tesla currently has no profitable business model.
If you want facts, please Google them. Here's a start that's titled "Tesla Motors Files For IPO - So Much For The Profits": http://blogs.wsj.com/venturecapital/2010/01/29/tesla-motors-...
At any rate, it's ridiculous to try and claim that they don't have a business model. If they're selling the cars for more money than the incremental unit cost, then they do indeed have a profitable business model.
They may not be selling enough of them yet to have a profitable company but claiming that they don't have a business model is just being obtuse.
Are you claiming that in 2001, Amazon had no business model? Because that would be the same thing.
http://www.techcrunch.com/2009/08/07/tesla-says-it-is-now-pr...
Real world mechanical/electrical innovation is hard, and there's a lot of investment up front.
Where would we be if people called ARPAnet a waste of money 8 years into its existence? I bet it was bleeding money for EIGHT STRAIGHT YEARS as well?
Second, the money that they get from the government is a loan, just like the government, particularly the Dept of Energy, gives to thousands of companies who's research/products have a chance of generating extremely positive externalities for the country. (Last I knew, the whole dependent on foreign oil thing is sort of a big deal)
So what are you against here? What differentiates Tesla from the rest of those companies? If a company had a promising approach towards cold fusion, would you be against a government loan to them as well?
"Tesla Motors Files For IPO - So Much For The Profits": http://blogs.wsj.com/venturecapital/2010/01/29/tesla-motors-...
VCs clearly aren't backing them further. They've resorted to an IPO to get cash. Tesla is down to its last $9 million.
Given that they just got a big loan, I doubt they're down to their last 9 million. Unless they spent it all in a week.
If you read the articles about them, they want to introduce another car model which will be a much higher volume business, involving a lot of capital expenditure up front to create the plant. That's a good reason to go IPO rather than another venture round. Higher dollars.
And if you don't buy it? Fine, don't buy the stock. But what's your ax to grind here? Every capital intensive business, including a lot of valley darlings, went through a long money-losing period at the beginning while they ramped up design and production. This is standard. Why the long face?