In case it's hard to wade through the silly Slashdot tax comments, here are some highlights:
> Let the market decide, not a group of politicians paid off by lobbyists from the money they're lobbying to get.
Tesla agrees. They've been very public about their opposition to the bailout. But if there is going to be one, Tesla should get money too.
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Tesla had been planning to undergo a massive scaleup to start producing their Model S sedan -- not mass-market prices, but in the much more affordable "luxury car" price range. To do this, they need to produce the car by the tens to hundreds of thousands per year. They had started scaling up, and then the global financial system cratered. They've since started *undoing* some of their expansion, laying off workers and closing offices. Now the Model S plans are on hold, and they're instead having to switch focus to becoming profitable on Roadsters alone. The crisis is throwing them back by years.
In a normal market environment, they likely would easily have gotten the loans that they needed. However, right now, only the government has the ability to make these kinds of loans. The government "bailouts" are loans, designed to fill in the gap for a financial system struggling to right itself. Now, one can argue that some of these loans are going to companies that will never be able to pay them back -- that we're pumping taxpayer money into bad investments that will fail anyways and forefeit on their loans when they collapse. But it's anything but a "giveaway", and it's hard to argue that the only companies that deserve loans are the few that can get them in our current crisis. And in the case of Tesla Motors, I think it'd be hard to make that "not deserving of a loan" argument at all -- especially concerning funds specifically earmarked for the advancement of clean technologies.
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Tesla Motors is in direct competition with General Motors and the Volt. Indeed, there are many places where GM executives have openly stated (including on 60 Minutes and other major media outlets) that they wouldn't have even started the Volt if it weren't for Tesla showing it could be done.
So tell me, why should GM get a special subsidy for building the Volt and Tesla be told to "get lost" and build their car on their own?
The $400m check isn't just a grant, it is a loan that must be repaid. What getting it from the government will do is provide basic capital to build the factories, finance the R&D, and get built the next generation of Tesla vehicles. Tesla even has the manufacturing facility picked out and some of the preliminary designs for that vehicle.
All that Tesla is doing here is to insist that they be treated as an American automotive manufacturer. If GM is getting the subsidy, why not Tesla as well?
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Tesla's request was so they could design and build a much cheaper electric family sedan; i personally believe that it is a good investment even if the car costs 50k.
It seems unlikely that tesla will mass produce a car, but it does seem likely that they will be gobbled up by a larger company that will.
It would be money well spent
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Who else is going to improve the technology? If it was one of the companies already in the industry, it'd be done by now. Don't give the entrenched guys anything. Give it to new companies.
Just because the rich get it first doesn't mean we won't get it, too. Look down at the device under your hands as you flame me for proof.
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I agree completely.
The best way to develop the technology and bring the cost down to something affordable is to have it in production. And right now Telsa is producing 15 MORE zero emission cars a week than all of the Detroit automakers combined.
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To say that a low interest loan to Tesla is a bailout for billionaires is to seriously ignore what Tesla is doing. While everyone else is either developing low-speed electric cars (e.g. cars that can't run on the highway and don't have to pass all of the safety regulations) or estimating that their electric hybrid will run AT MOST 40 miles off the battery, Tesla has developed the first practical all electric car that can run 200 plus miles on a charge using (mostly) existing technology. You know, something that the big three for the last 20 years has said couldn't be done.
In addition, Tesla is continuing to work to engineer a pure electric car for the masses. This is where most of the money would be applied. It's not to bail out the roadsters already being built/already on order.
Plus, the established auto makers research is primarily still into improving ICEs, which is inherently, horribly inefficient. We've had over a hundred years of research and development into improving the ICE and it's still AT BEST only 25% efficient. We don't need any more ICE development, thank you very much. Considering that the Tesla roadster gets 4 times the fuel efficiency as the best ICE, the money would be applied exactly as it is intended (something that would probably not be the case for GM and company).
Lastly, if we're talking about bailouts, why should taxpayers bail out the Big Three? Their officers are responsible for pitifully shortsighted business decisions for the last 30 years, culminating in the current state of the US auto industry. If we reward businesses for bad business decisions, what's the incentive to do better? Let them be bought out by Toyota, et al. Good riddance, I say.
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Seriously, folks - this has less to do with protecting the Rolls Royces of this world, and more to do with encouraging alternate means of locomotion.
Where would you rather give your money (if you're a US taxpayer, it is your money)... to a bunch of failing and backwards-looking automaking corps, or to a young and hungry company that is looking to change the very way we fuel up our cars?
Forget the politics - the Big Three are in thrall to a wage and compensation plan that is simply unsustainable and way above market value, no matter how the mathematics are applied. Not blaming the unions per se (the corps agreed to it, after all) but seriously - add it up yourself.
Coupled with the dragging and tooth-pulling required to get the likes of GM and Ford to go all-alternative (or to even jack up the fuel efficiency to something near what the competition has right now)? Why bother? They'll simply make a lot of noises about having changed their ways, and 10 years later they'll be right back in Congress again, begging for more money.
This may sound trollish, but screw that - let the innovators of this world get a leg-up, if we're going to be throwing around money in the first place. Let the collapse of the Big Three be an object lesson to those who think they're somehow entitled to continued existence just because they happen to be a big corporation.