Those who favored the extension of corporate welfare for alternative energy-fueled automobiles justified their decision with the same phony claims they made ten years ago when the ATVM program was established.
As it continues to defy common sense and the laws of economics with its lofty stock price, Tesla has again shown it has little corporate competence in the ability to deliver a consistently functional product that satisfies customers.
The latest evidence comes in the recently rolled out Model X, which is allegedly an SUV, but looks like just another car. Retailing at a price only the extremely wealthy can afford ($138,000), the all-electric follow-up to the similarly troubled Model S automobile has stumbled out of the gate. The problems were outlined in a Consumer Reports article posted online Tuesday, which spurred a number of similar follow-up stories in other media, and temporarily caused Tesla’s stock to dip. Long-time followers of the company know that is only a temporary condition, however.
Wall Street, media and government darling Tesla Motors has seen its stock price nearly halved from seven months ago. For so long it has seemed that ongoing bad news never had an effect on the heavily subsidized upstart, but now perhaps the Teflon is eroding off CEO Elon Musk.
The precipitous, rapid descent preceded last week’s horrid earnings report. USA Today helped smear lipstick on the pig, cheerily noting shares rose “14 percent at one point” after its earnings “miss” on Wednesday, because Musk delivered investors a "rosy outlook for the rest of 2016." This was in context of what the newspaper characterized as a “whopping loss” that “badly missed estimates.”
The evidence could not be any clearer than what has happened in Atlanta. As Watchdog.org has reported, since a $5,000 state tax credit expired on July 1, sales of “zero-emission” electrics such as the Nissan Leaf have plummeted. Whereas monthly sales averaged 915 in 2015 until the year’s midpoint, sales in the month of August fell to 148, according to vehicle registration data compiled by R.L. Polk & Co.
An electric truck manufacturer that was awarded $32 million from President Obama’s stimulus program has informed one of its investors that it is on the verge of bankruptcy, if it did not raise $4.5 million by Friday and $10 million by the end of October.
The troubled saga of Smith Electric Vehicles should be particularly sickening for taxpayers because it sprouted out of a similar failed company, of the same name, in Great Britain. Smith, as part of the U.K.-based Tanfield Group, stumbled out of Europe and re-established itself in Kansas City – opportunistically at the time that President Obama was rolling out his plans to “stimulate” the “green” energy sector in early 2009.
Allegations in civil lawsuit threatens to mar the reputation of Secretary of Transportation Anthony Foxx (Flickr Photo: MTyndall).
Hehas been sued in the case of defunct DesignLine USA. The Charlotte-based hybrid electric bus-maker declared bankruptcy in 2013 after years of missteps that included maintenance problems, production problems, missed deliveries, lawsuits, and an FBI investigation. Its assets were sold to an investment group and the company now operates with a much lower profile, under the name EPV Corp.
Oh, sure, after another dismal performance (operating loss of $47 million) for Tesla Motors during the most recent quarter, its stock price took an immediate dive of 9-10 percent. But while that merely returned the electric automaker back to irrational exuberance territory – as compared to the drunken sailor highs it has enjoyed in recent months – it didn’t take long for some market analyst to restore the inflation.