Announcements Post Suppliers Summit August 2015

[JEBar]

Would you hand over millions to a startup company with no current source of revenue (no product to sell) promising to manufacture a concept vehicle that needed the ATVM loan to do so with no other real funding options in the bank? Pre-orders are a positive market indicator and a source of future revenue, but that doesn't guarantee EM's financials to repay the loan until they are a viable business. I think the DOE is being justifiably cautious in waiting for the P5 and any additional info needed to make the final approval.

what an individual would be likely to do and what the government would be likely to do may well be mutually exclusive events .... the reality is the government loan program EM is working with has done just that .... some of their loans have turned out to be bad investments .... some of their loans have turned out to be good ones .... I suspect, but have no way of knowing for sure, that on paper EM has a much stronger sales potential (reservations) than many of the companies that have applied for the same type of loans .... as one totally hypothetical example, with EM closing in on 50,000 reservations, if they only make $10 pure profit on each one, that would equal a half million dollar pure profit .... I strongly suspect that EM has hired some very competent personnel to formulate their application .... I believe it is highly likely that they have dotted their i's and crossed their t's .... there is no way that anyone who doesn't have direct access to EM's application and the evaluations of the government workers processing the application can do anything but offer a pure, unsubstantiated guess

 

[WilliamH]

Apparently you would hand over millions to a startup company with no current source of revenue (no product to sell) promising to manufacture a concept vehicle that needed the ATVM loan to do so with no other real funding options in the bank. I wouldn't risk it. Pre-orders are a positive market indicator and a source of future revenue, but that doesn't guarantee EM's financials to repay the loan until they are a viable business. I think the DOE is being justifiably cautious in waiting for the P5 and any additional info needed to make the final approval.

If they don't consider the cost to build, then it's precisely the reason for the $18 trillion of debt you mentioned earlier.

Rick, Neither you nor I have any real idea why the bureaucrats are dragging their feet. I'm sure if it was called Solyndra 2 and it was making solar cells it wouldn't take them any time. They'd just initial it with no assets like they did Solyndra and Fisker.

 

[Rickb]

Rick, Neither you nor I have any real idea why the bureaucrats are dragging their feet. I'm sure if it was called Solyndra 2 and it was making solar cells it wouldn't take them any time. They'd just initial it with no assets like they did Solyndra and Fisker.

Perhaps the DOE learned a lesson from the problems caused by the Fisker and Solyndra failures. EM has no tangible assests either which is my point.

 

[AriLea]

If they don't consider the cost to build, then it's precisely the reason for the $18 trillion of debt you mentioned earlier.

Don't forget, the price of an Elio is not the only income stream. PE often put a spotlight on the accessories and options that have a lot higher mark-up.

You know, typical for fast food. The Hamburgers are cheap, the beverages and fry's are expensive.

 

[Mike W]

Yup, they'll make a lot of money on the "smalls". Like the '49' gold rush, most people got rich by selling stuff to the miners, not from finding gold!

 

[Kuda]

Perhaps the DOE learned a lesson from the problems caused by the Fisker and Solyndra failures. EM has no tangible assests either which is my point.

With over $100m in realistic
reservations + misc equip, etc.
I don't think assets per se are
the ATVM issue. Elio must
prove the ability to produce
a viable & safe product.........

 

[Rickb]

what an individual would be likely to do and what the government would be likely to do may well be mutually exclusive events .... the reality is the government loan program EM is working with has done just that .... some of their loans have turned out to be bad investments .... some of their loans have turned out to be good ones .... I suspect, but have no way of knowing for sure, that on paper EM has a much stronger sales potential (reservations) than many of the companies that have applied for the same type of loans .... as one totally hypothetical example, with EM closing in on 50,000 reservations, if they only make $10 pure profit on each one, that would equal a half million dollar pure profit .... I strongly suspect that EM has hired some very competent personnel to formulate their application .... I believe it is highly likely that they have dotted their i's and crossed their t's .... there is no way that anyone who doesn't have direct access to EM's application and the evaluations of the government workers processing the application can do anything but offer a pure, unsubstantiated guess

My guess is the ATVM Loan will not be approved without some locked in guarantee that it can be repayed. Lesson learned from Fisker Motors failed ATVM Loan. Tesla at least had infrastructure and was manufacturing cars at the time of their loan which has been repaid some 10 years early. I think EM's loan application will be approved, but EM has some work to do before that approval with the P5, the P5 testing, and additional venture capital earmarked for production of the E6-25. That would indicate tangible evidence that EM is on track to production and justify the added ATVM Loan boost to cross the finish line.

 

[Graemexx]

With over $100m in realistic
reservations + misc equip, etc.
I don't think assets per se are
the ATVM issue. Elio must
prove the ability to produce
a viable & safe product.........

I think that the government will not consider it a safe product until the car has a detachable roof. One passenger burning to death because the driver is dead , unconscious, or unable to open the door, will be the end of Elio

 

[Rickb]

With over $100m in realistic
reservations + misc equip, etc.
I don't think assets per se are
the ATVM issue. Elio must
prove the ability to produce
a viable & safe product.........

I think EM has the ability to produce a viable and safe product, but needs tangible assets/funding to pull it off.

 

[WilliamH]

I think EM has the ability to produce a viable and safe product, but needs tangible assets/funding to pull it off.

Rickb, we keep on hearing you say "In your opinion" or equivalent. How about quoting things and providing references in support of your opinion. Don't know about others, but your opinion just doesn't get it done for me. It's like hearing a politician talk after a while.