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

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Elio Amazed

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The standard they have to meet is "a reasonable prospect" to repay the loan and a positive net present value.
Is EM currently a reasonable prospect? Nope.They're a huge risk.
It may be that your idea of "a reasonable prospect" is quite a bit different than the DOE's.
Again, the good news (if any) is that the DOE could care less if EM's got a "positive net present value" or not.

I agree with a lot of others here. Without a direct line to the DOE gods and the inner secrets of EM...
This is like us all sitting in the middle of a summer field, picking the pedals off of daisies, and saying...

They love me, They love me not...
 
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MotorcycleKopp

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If I were to put myself in the position of a bank, given the current financial numbers I see, there is absolutely NO WAY that I'd be loaning EM any kind of significant amount of money in their current position. Of course however, this is purely based on public information. And since this IS a startup, given the HUGE amount of progress & headway that EM has already made, I'm hoping that any future potential lenders take this into consideration.

Hopefully what Paul has said in the past about there being multiple paths to fully fund this project is true. But right now it looks like the "make or break" point is VERY near.
 

Elio Amazed

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Besides, even if it were a factor, "a positive net present value" does not mean how much more EM COULD make than they owe IF they could only get $117M more in private investments and IF they could only get the ATVM guarantee and IF they could actually THEN make and sell enough vehicles to put their numbers in the black. That's called pie in the sky, and is definitely not the definition of "a positive net present value". I sure hope there is some secret powerful voodoo somewhere that none of us know anything about. If there is, it sure is taking a long time to ferment. Meanwhile, the bills continue to pile up.
 
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slinches

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Net present value is essentially a "what-if" type of analysis for an investment using conservative, but reasonable assumptions. It does include predictable future revenues as well as costs. The calculation is actually just projected revenues less projected costs, corrected for inflation and discounted for probability of occurrence. A positive value just means that, with the information known to date, the investment shows a positive ROI. If you don't believe me, go look it up.

And for the likelihood to be able to repay the loan, a "reasonable prospect" in financial terms means more likely than not to happen. It doesn't need to be absolutely guaranteed, just better than ~50% chance of happening if the loan is granted.

Those are the written requirements. There are almost certainly additional political ones to overcome, but if those hurdles can be cleared, I don't see any reason that EM would be disqualified by the loan qualification terms as written.

We need to be discussing what those political hurdles are and how to clear them.
 

RSchneider

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The political hurdles are gone. This administration is all about getting Americans back to work and American made. If Elio doesn't get this loan then there must be a real problem we haven't heard about because Trump will not let the big 3 push him around and they know it. Elio is just too important to fail and it will also be a great export item that won't have all of those goofy tariffs that other countries put on American made goods.
 

skygazer6033

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Are assets considered part of "net present value"? If so, remember EM owns the tooling and equipment left by GM in the Shreveport facility. Paul borrowed $20 million or so from Stu Lickter to purchase that equipment. Part of it can be used in the manufacturing of the Elio and the rest sold or scrapped. The equipment and the long term lease arrangements for the Shreveport facility is really quite an asset. So IMO Paul is much better off than just his hat in his hand and a good idea.
 

larryboy

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If I were to put myself in the position of a bank, given the current financial numbers I see, there is absolutely NO WAY that I'd be loaning EM any kind of significant amount of money in their current position. Of course however, this is purely based on public information. And since this IS a startup, given the HUGE amount of progress & headway that EM has already made, I'm hoping that any future potential lenders take this into consideration.

Hopefully what Paul has said in the past about there being multiple paths to fully fund this project is true. But right now it looks like the "make or break" point is VERY near.
 

larryboy

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If I were to put myself in the position of a bank, given the current financial numbers I see, there is absolutely NO WAY that I'd be loaning EM any kind of significant amount of money in their current position. Of course however, this is purely based on public information. And since this IS a startup, given the HUGE amount of progress & headway that EM has already made, I'm hoping that any future potential lenders take this into consideration.

Hopefully what Paul has said in the past about there being multiple paths to fully fund this project is true. But right now it looks like the "make or break" point is VERY near.

That is the point of having a government loan program. It provides startup money for projects that are either too big or too speculative for a bank to consider.
 

slinches

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The government doesn't lend the money. Lending institutions lend the money. The government insures that the lending institutions will be paid back.
Whether or not that's true, it's irrelevant. It's still the program's purpose to accept some financial risk to accelerate the progress of high fuel efficiency vehicle manufacturing.
 
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