Jalopnik Claims Elio Has Only $100k In Bank, $123 Million In Debt

[Elio Amazed]

With the loan, they don't need additional federal funding, which is precisely what that requirement is about. The ATVM loan along with private investment and pre-production fleet sales will get them to the point of high volume production (the $300M that EM has stated). The revenue from those production sales will be more than enough to pay back the loan. That's what the DOE requires, not the ability to pay for everything without the loan. What's the point of the program if you need to have all of the money to fund your project without it?

They may not need additional Federal Funding, but they need addtional funding over and above the amount that the DOE will guarantee in order to start production. They've said time and time again. The amount needed to start production is $300M, not $183M. The DOE is not going to gamble on EM magically and all of a sudden getting $117M in private funding AFTER they commit and give EM the guarantee. It doesn't work that way.

 

[slinches]

The private investments could be secured, but contingent on the grant of the ATVM loan. In that case, there's no need for the DOE to "gamble". Or they could adjust the size of the loan to cover the whole $300M.

In any case, all we know is that EM is confident that their funding plan meets the criteria. Stating that they can't because of this "additional federal funding" clause, is not justified.

 

[Officespaced]

You keep missing the word "additional", as in addition to the ATVM loan. If the loan is granted, they'll have more than $185Million and will be able to find private financing to cover whatever remaining funds are needed to get to production.

The point of that requirement is to prevent a company from needing to be on perpetual government assistance to pay off the loan.

It means, they can survive with or without the loan, Elio, XP Motors, Aptera cannot; Ford and Tesla can. See the difference? Elio cannot deliver unless they have the coin from somewhere outside of the ATVM. With $100K, it's not looking bright. What don't you get? Elio has only passed 1 of the 4 steps in acquiring the loan. XP Motors delivered on all points, yet four years after, had yet to receive a decision and folded due to funding issues. Aptera had $150 million in external funding lined up if they received the ATVM loan. They did not get it and thus no $150 million and folded. If Elio cannot get outside funding, they are another chapter in failed alternative vehicles.

 

[Elio Amazed]

The private investments could be secured, but contingent on the grant of the ATVM loan. In that case, there's no need for the DOE to "gamble"

So according to what you're saying it's a catch 22. EM can't get the needed investors without getting the ATVM guarantee first. And the DOE won't stick their necks on the block without EM getting the $117M worth of investors first.

 

[Officespaced]

The private investments could be secured, but contingent on the grant of the ATVM loan. In that case, there's no need for the DOE to "gamble". Or they could adjust the size of the loan to cover the whole $300M.

In any case, all we know is that EM is confident that their funding plan meets the criteria. Stating that they can't because of this "additional federal funding" clause, is not justified.

Aptera had $150 million lined up, but contingent on ATVM loan. That didn't persuade the DOE and denied the funding.

 

[slinches]

So how did Tesla get their loan then?

 

[Officespaced]

Okay, I'm done Despite the rhetoric, I hope Elio makes it. Unlike probably most of you, I have vested stock market interest in them making it. I've already been called a short-seller troll, but I'm long and will likely lose it all. Good luck, let's hope they make it, but be reasonable and vigilant.

 

[Elio Amazed]

In any case, all we know is that EM is confident that their funding plan meets the criteria.

EM has been confident of a lot of a lot of things through the years.

Just sayin' The DOE apparently doesn't buy that either.
As I see it. the $117M discrepancy is the major wrench and holdup.
The fact that the DOE asked EM for the "lock-in" requirement was a good sign.
I personally think the DOE likes EM's market acceptance and 'post production start' plan.

 

[slinches]

I was just pointing out that you were conflating different requirements. It's not the "additional federal funding" clause that's the hang up, they aren't requesting any other federal funding. It's the "financially viable" clause (positive net present value) that is at issue.

The requirements can be found here: https://www.energy.gov/sites/prod/f...ce_for_Potential_ATVM_Applicants_June2016.pdf
and this is the specific definition that EM must meet to qualify:

Financially viable means a reasonable prospect that the Applicant will be able to make payments of principal and interest on the loan as and when such payments become due under the terms of the loan documents, and that the applicant has a net present value that is positive, taking all costs, existing and future, into account.

 

[Elio Amazed]

I was just pointing out that you were conflating different requirements. It's not the "additional federal funding" clause that's the hang up, they aren't requesting any other federal funding. It's the "financially viable" clause (positive net present value) that is at issue.

The requirements can be found here: https://www.energy.gov/sites/prod/f...ce_for_Potential_ATVM_Applicants_June2016.pdf
and this is the specific definition that EM must meet to qualify:

I agree with the first part of your response. That's what I've been saying all along.

However, it's not even the positive net, present value that's the issue.
The issue is that the DOE wants to be 100% sure that EM will be able to go into production...
And execute their proposed plan upon being given the ATVM loan guarantee. Period.
And NOT months to years after that, and even then only...
IF EM can get addtional private investments to the tune of $117M, or more...
Considering they'll still be burning through money as they try to raise those funds.
As far as the DOE is concerned that's the HUGE if. That's the issue.