Securities And Exchange Commission Form 1-k - Filing Date: 2016-04-29

[Ekh]

A very interesting increase in production tooling, a major factor in the newly revised up cost, and advertising also nearly doubles though not nearly as large an overall chunk of expenditure. Thoughts on what would lead to such an increase in estimating production tooling?

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It's possible they may have to build some stuff they'd figured on outsourcing, which is why production tooling has tripled. Their advertising budget to date has been peanuts, and at $12,000,000 it's still small relative to the size of the venture and spread over two years.

But it still looks as if they got some fundamental calculation very, very wrong.

What is not clear to me is the timing on all this money, and whether these numbers are total project budget, or money still to be raised. It makes a huge difference, and I wish EM would clear this up once and for all. It could be done in one sentence: As of this date (00/00/2016), we have raised $X. To launch the product, we still need $Y." Just think of the big thermometers people like Red Cross used to erect to measure progress to a fundraising goal. Something like that would help, too.

There have been so many numbers bandied about by Elio in the course of their fundraising that this sort of clarification is really needed. Confused investors are not eager investors.

 

[John Painter]

It's possible they may have to build some stuff they'd figured on outsourcing, which is why production tooling has tripled. Their advertising budget to date has been peanuts, and at $12,000,000 it's still small relative to the size of the venture and spread over two years.

But it still looks as if they got some fundamental calculation very, very wrong.

What is not clear to me is the timing on all this money, and whether these numbers are total project budget, or money still to be raised. It makes a huge difference, and I wish EM would clear this up once and for all. It could be done in one sentence: As of this date (00/00/2016), we have raised $X. To launch the product, we still need $Y." Just think of the big thermometers people like Red Cross used to erect to measure progress to a fundraising goal. Something like that would help, too.

There have been so many numbers bandied about by Elio in the course of their fundraising that this sort of clarification is really needed. Confused investors are not eager investors.

I agree, many questions. I know the total cost for production has always been estimated at around $300 million. The more time goes on, the more complex the accounting will become and harder to follow.

 

[Hog]

Looks like it will be the Electra Meccanica for me, not my first choice for sure, but doable much sooner, probably later this year.

 

[Marshall]

I take their latest K-1 document at face value.

My take away is... the project is stalling because of the apparent lack of sufficient funding... and their debt load continues to escalate.

Granted...product development continues...but the ongoing engineering challenges appear to be much great in scoop (and cost) than Elio Motors had anticipated.

The K-1 data seems to indicate there are a whole host of deteriorating metrics for Elio Motors.

I'll certainly let everyone draw their own conclusions after they review the current K-1.

Thanks Tesla. Just let me know when the Tesla is under $20k.

 

[Sethodine]

A very interesting increase in production tooling, a major factor in the newly revised up cost, and advertising also nearly doubles though not nearly as large an overall chunk of expenditure. Thoughts on what would lead to such an increase in estimating production tooling?

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For ease-of-comparison, here is the change between those two:

  Uses:           Change:
Prototype         -136,000.00
Engineering    -11,127,000.00
Advertising      4,715,000.00
Other Expenses  17,255,000.00
Tooling         75,460,000.00
Plant Setup    -39,283,000.00

I believe this reflects both changing needs/goals, and reduced allocation due to funds already being spent in particular areas.

 

[Rob Croson]

Remember that the SEC filings are intentionally grim and worst-case.

 

[Jeff Porter]

It is easy to get caught up in the "grimness" for sure. But as Paul has said in the past, they just keep their heads down and focus on the next thing to get done.

Many thanks to Jambe for the post.

 

[Ekh]

I take their latest K-1 document at face value.

My take away is... the project is stalling because of the apparent lack of sufficient funding... and their debt load continues to escalate.

Granted...product development continues...but the ongoing engineering challenges appear to be much great in scope (and cost) than Elio Motors had anticipated.

The K-1 data seems to indicate there are a whole host of deteriorating metrics for Elio Motors.

I'll certainly let everyone draw their own conclusions after they review the current K-1.

Their financial metrics are getting worse? Maybe just more candid and more accurate -- and more depressing. The car and the project, however, are progressing rapidly. But I believe this year, probably by the end of October, is make-or-break for elio motors. ATVM means they have a shot. Otherwise, kaput.

 

[Ekh]

For ease-of-comparison, here is the change between those two:

  Uses:           Change:
Prototype         -136,000.00
Engineering    -11,127,000.00
Advertising      4,715,000.00
Other Expenses  17,255,000.00
Tooling         75,460,000.00
Plant Setup    -39,283,000.00

I believe this reflects both changing needs/goals, and reduced allocation due to funds already being spent in particular areas.

Thanks. Very helpful. So the net increase in required funding is just as bad as it looks.

 

[Ty]

A very interesting increase in production tooling, a major factor in the newly revised up cost, and advertising also nearly doubles though not nearly as large an overall chunk of expenditure. Thoughts on what would lead to such an increase in estimating production tooling?

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It could very well be that they decided to do some tooling in-house that they were planning on out-sourcing (like the engine foundry). If that were the case, they'd have to secure the tools necessary to do the tooling. That would lead to a higher startup cost but be lower in the long run.