It's Official . Paul Has Let Me Down

[Rob Croson]

Type in Mclaren and look at the postings for 2015. Elio was using Mclaren then switched to IAV

I did. All I could find was a posting or two in another forum about someone saying that Linamar (which owns McLaren) building the engines makes things go full circle since they were originally supposed to design the engine. But McLaren didn't design it in the end, IAV did. EM posted the one prototype engine dyno video in March of 2015. It was the IAV engine, which means IAV had been designing the engine well before that in 2014. So why would there be an announcement about Elio/McLaren in 2015? The only Elio/McLaren postings I can find are lists of random general interest car stories that just happen to mention some McLaren supercar on the same page as a separate story about Elio. I didn't reserve until mid-2014, and didn't really start following until early 2015, so any McLaren stories would have been before my time.

 

[Samalross]

If I remember correctly Mclaren was going to modify the Geo engine. I think that Elio decided to make an all new engine and used IAV. There was a falling out with IAV over a debt of 1.6 million owed by Elio. That is why it is not on the list of suppliers and why Elio has only two or three engines. Rick has been on here a long time and has a good memory, maybe he can fill you in better.

 

[Travelbuzz1]

I just sent an email to Elio about this and we will have to wait for an answer.

 

[Samalross]

I just sent an email to Elio about this and we will have to wait for an answer.

Sorry I couldn't be of more help, my memory is not like it used to be. My mother is 93 and has a better memory.

 

[RSchneider]

On June 30, 2015 Elio has this listed:

“December 31, 2014. As of December 31, 2014, we had cash of $374,652 and a working capital deficit of $8,446,483, as compared to cash of $869,107 and working capital of $260,884 at December 31, 2013. Included in the current liabilities is a note payable due to IAV Automotive Engineering Inc. in the amount of $1,600,000 as payment for research and development work. The note is due December 31, 2015 and secured by a third position security interest in our equipment at the Shreveport facility. We have agreed to pay monthly installments of $150,000 against the note.

“On March 13, 2015, the Company signed an installment payment agreement with IAV Automotive Engineering, Inc. The agreement confirms the balance of the outstanding debt to be $1,323,000 and requires monthly payments of $150,000 to be made on the 15 th day of each month with the balance paid in full by December 1, 2015.”

At the end of 2015:
“On December 5, 2014, the Company converted $1,600,000 of payables owed to one of the research and development vendors to a promissory note. The note incurred interest at the Federal Funds rate per annum. The note was paid in full on December 10, 2015. Interest expense incurred on the note for the years ended December 31, 2015 and 2014 amounted to $4,197 and $255, respectively. “

In August 2017:
“The Elio engine is an inline 0.9 liter, 55 horsepower three-cylinder combustion engine, which has been custom-developed for us by IAV.”

Looks like to me that Elio paid off IAV and IAV did the engine. I cannot find any information about McLaren on any supplier or engineering partner. I suspect that any McLaren involvement was a long time ago and not pertinent today. It would be cool to tell everyone that your Elio has an F1 engine in it. Instead, you'll just have to tell them it's a Porsche (since VAG owns 50% of IAV).

 

[Rickb]

On June 30, 2015 Elio has this listed:

“December 31, 2014. As of December 31, 2014, we had cash of $374,652 and a working capital deficit of $8,446,483, as compared to cash of $869,107 and working capital of $260,884 at December 31, 2013. Included in the current liabilities is a note payable due to IAV Automotive Engineering Inc. in the amount of $1,600,000 as payment for research and development work. The note is due December 31, 2015 and secured by a third position security interest in our equipment at the Shreveport facility. We have agreed to pay monthly installments of $150,000 against the note.

“On March 13, 2015, the Company signed an installment payment agreement with IAV Automotive Engineering, Inc. The agreement confirms the balance of the outstanding debt to be $1,323,000 and requires monthly payments of $150,000 to be made on the 15 th day of each month with the balance paid in full by December 1, 2015.”

At the end of 2015:
“On December 5, 2014, the Company converted $1,600,000 of payables owed to one of the research and development vendors to a promissory note. The note incurred interest at the Federal Funds rate per annum. The note was paid in full on December 10, 2015. Interest expense incurred on the note for the years ended December 31, 2015 and 2014 amounted to $4,197 and $255, respectively. “

In August 2017:
“The Elio engine is an inline 0.9 liter, 55 horsepower three-cylinder combustion engine, which has been custom-developed for us by IAV.”

Looks like to me that Elio paid off IAV and IAV did the engine. I cannot find any information about McLaren on any supplier or engineering partner. I suspect that any McLaren involvement was a long time ago and not pertinent today. It would be cool to tell everyone that your Elio has an F1 engine in it. Instead, you'll just have to tell them it's a Porsche (since VAG owns 50% of IAV).

Please post your indication of EM’s paid in full IAV contract documentation. That contract payment was required to be paid in full before IAV did any additional testing on the engine, beyond the dyno testing. There is no indication of additional IAV testing, EM mention of the engine since the dyno video, and I haven’t seen a tested validated engine in an Elio prototype.

 

[Watashiwah]

Please post your indication of EM’s paid in full IAV contract documentation. That contract payment was required to be paid in full before IAV did any additional testing on the engine, beyond the dyno testing. There is no indication of additional IAV testing, EM mention of the engine since the dyno video, and I haven’t seen a tested validated engine in an Elio prototype.

Correct me if I am wrong, but even if EM did finally pay IAV the 1.5 million bucks; there was never any news about that engine's performance. My recollection was just a simple video (that almost looked bootlegged, IMHO) informally released. It had the same informality and vagueness that that push to get to 65,000 reservations that was supposed to inspire the DOE to make a the ATVM loan. By any standard, the most important number would be engine performance (MPG) not just getting 65,000 people to conveniently buy in at any level. There seemed to be ideas, efforts, and at least this one video, leaked out to inspire confidence but without substance and difficult to formally tie back to Elio Motors.

It will be interesting to see if that 1.5 million ever made it to IAV.

 

[RSchneider]

There's no listing in the most current SEC filing that Elio owes IAV anything. As for others (mostly anything Stu is involved with) they own a pretty penny and it'll be paid off from the $100M NASDAQ listing. Other than that, it looks like EM was smart and paid off the suppliers and engineering partners. If they didn't, then we would have known about it by now. It was obvious by the way the IAV financials were handled was that they were ready to not be nice any more and play hardball. Thus the reason for the payment plan. When you do that (take too long to pay) to companies like that, they go to a cash up front basis for any further work and that comes in at an increased labor rate.

I'd guess they probably needed to pay that money off to physically receive the engines so they could install them in the E-Series cars. Companies have a nasty tendency to hold onto physical items or information that you really need. Give them over when the check clears. They don't care that your idea is going to revolutionize the industry. They have bills to pay today.

 

[Ace]

I assume the E1A is the only one of the e-series that got completed with a full IAV running motor. The E1D and E1E were slated for engine and suspension testing but did any of that actually ever happen? You would think in all this time since August 2016 that the E1A car at least could have been put on a track for preliminary mileage testing and some sort of announcement made on that. The P5 has been knocking around in pictures but the E cars are ghosts.

 

[Rickb]

There's no listing in the most current SEC filing that Elio owes IAV anything. As for others (mostly anything Stu is involved with) they own a pretty penny and it'll be paid off from the $100M NASDAQ listing. Other than that, it looks like EM was smart and paid off the suppliers and engineering partners. If they didn't, then we would have known about it by now. It was obvious by the way the IAV financials were handled was that they were ready to not be nice any more and play hardball. Thus the reason for the payment plan. When you do that (take too long to pay) to companies like that, they go to a cash up front basis for any further work and that comes in at an increased labor rate.

I'd guess they probably needed to pay that money off to physically receive the engines so they could install them in the E-Series cars. Companies have a nasty tendency to hold onto physical items or information that you really need. Give them over when the check clears. They don't care that your idea is going to revolutionize the industry. They have bills to pay today.

There is no indication that the IAV balance was paid in full or if the engine has tested beyond the dyno testing, or in the E1A. If it was we would or should have seen some track testing video to show some progress and spark some excitement.