Tesla Motors' history, according to Elon Musk

Iff you're right, and Tesla could get their unit cost down to $25k (a final BMW sticker price, FWIW), they'd still be left with the challenge of bringing a mass-market product to market. They'd have to build a sales and delivery channel, create a supply chain that could sustain the volumes required to run a lower-margin business, and, after all that, be competing in a segment that services value-conscious buyers, many of whom are already confused about the difference between hybrid and PEV.

That's iff you're right. But you probably aren't. Because you're swagging materials costs out of thin air when talking about a product that went from $140k in materials alone to $80k in a span of months. That was apparently a harrowing crisis for a product with a six-figure sticker. For a car that would go up against a BMW 3-Series, they'd have no such margin of error.

In the end, you have to ask yourself what the world should be getting from Tesla. If it's technology, then who cares who they sell it to first? Why would you ask them to pursue a business model that increases the chances that they'll go out of business before they ship rev2, rev3, and rev4? Why does the final product even need Tesla's badge on it? Maybe, like many other luxury manufacturers, Tesla's badge will always be prohibitively expensive, but their components will OEM to much more cost-effective platforms from Daimler.

That said, guaranteeing a loan to Tesla is about the best thing I can imagine taxpayer funds being used for. They are shipping electric cars now that people are raving about, and expect to be cash flow positive soon.

Electric and hybrid propulsion is the future, and if we can get their faster with some loan guarantees, why not?