Elon Musk’s quarterly earnings reports for Tesla Motors always offer a little razzle, a little dazzle, soon-to-be-unfulfilled promises, and rationalized failures.
This go-round was no exception, and after yet another shortfall of financial and vehicle delivery expectations, perhaps the biggest surprise was the revelation that $1.3 billion in subsidies from Nevada taxpayers won’t be enough to get the hyped Gigafactory completed.
Spending and construction have only just begun on what is supposed to be Tesla’s battery-making monster. According to its 10-Q filing with the Securities and Exchange Commission, $431 million was spent on the Gigafactory through June of this year, and $520 million is expected to be spent by the end of 2016. Tesla’s partner in the project, Panasonic, said last month it would raise $3.86 billion, with most of it targeted for the Gigafactory. Another $1.7 billion came in via yet another equity sale. Alas, it apparently …
Alt-energy/transport-tech CEO Elon Musk and his trio of companies (Tesla, SolarCity and SpaceX) didn’t cooperate with the Los Angeles Times on its article that tabulated his businesses’ whopping sum of corporate welfare ($4.9 billion), and he was predictably miffed by the (accurate) portrayal.
So he went about trying to fix things on CNBC and with the Times on Monday, but not by denying the conclusions reached by reporter Jerry Hirsch, but instead by essentially pointing at fossil fuel industries and saying “they do it more.”
“If I cared about subsidies,” Musk told Hirsch in a follow-up to his Sunday expose’, “I would have entered the oil and gas industry.” He added that the financial help he receives is a “pittance” compared to government backing of fossil fuels.
Musk’s resentment (envy?) of oil and gas subsidies is amusing. Would you like to shoot your rockets into space …
Well, somebody did it, and it was the mainstream media. Congratulations to the Los Angeles Times for taking the time to research and estimate the total amount of U.S. public (local, state, and federal) subsidies for companies owned or run by South African-born Canadian-American Elon Musk.
The total amount calculated by reporter Jerry Hirsch for taxpayer-backed incentives – of many different forms, including tax credits and rebates provided to customers – was $4.9 billion. The corporate beneficiaries have been Tesla Motors and SpaceX, where Musk is CEO, and SolarCity Corp., where he is chairman. The sum does not include SpaceX’s contracts with the government to carry out programs for NASA and the U.S. Air Force.
“Government support is a theme of all three of these companies, and without it none of them would be around,” said Mark Spiegel, a hedge fund manager for Stanphyl Capital Partners, to the Times…
There was little doubt that once CEO Elon Musk and Tesla announced they would locate their electric vehicle battery “Gigafactory” in Nevada, that Silver State lawmakers would vote in a special legislative session to support targeted tax breaks and incentives – even at the breathtaking amount of $1.3 billion.
Gov. Brian Sandoval, the courter, would have appeared an extreme fool if he didn’t already have the political backing needed for the deal. But there were other mini-surprises: Unanimity at the legislature; four separate bills passed to construct the package; and benefits enjoyed by other industries in Nevada that were rescinded to help with the Tesla payoff.
“This is obviously an historic and exciting day for our great state,” said Democrat state Sen. Justin Jones from Las Vegas.
Just imagine how Nevada lawmakers would feel if they won the heart of a real automobile company, like Texas just did…
President Obama’s speech last week that re-emphasized his commitment to reduce US carbon dioxide emissions brought dismay to those who appreciate affordable energy, but it sparked a celebration among corporate types who have long sought caps and taxes on CO2.
While it was still more words from the president, which don’t always match his actions, on CO2 limitation he has largely kept his promise to environmentalists. Critics slammed his plan to bypass Congress and to task the Environmental Protection Agency to curb emissions via executive order, but EPA has operated out of bounds since he was inaugurated in 2009 – especially with the “war against coal” that is now universally accepted as true.
“What has us most encouraged by the president’s speech is he is lacing up his gloves and getting ready for that fight,” said Michael Brune, executive director for the Sierra Club, in an interview …
Taxpayer-supported Tesla, recipient of a $465 million stimulus loan guarantee to produce yet another electric toy car (the Model S) for rich people, reported its 4th quarter earnings last week. The word from billionaire CEO Elon Musk (Flickr photo: Jurvetson) was, “we’ll do better next quarter – promise.”
That’s a paraphrase, but nonetheless Tesla’s announcement fell short of most Wall Street analysts’ expectations. The company lost $90 million for the quarter as it ramped up production to fill pre-orders, paying workers to put in an average of 68 hours per week in December. On Thursday the company suffered the biggest one-day drop in its stock price – tumbling nearly 10 percent – in more than a year. Shares fell to $35.16 before recovering slightly on Friday, but were at $34.38 for Tuesday morning’s opening.
Unlike its counterpart Fisker, Musk and Tesla have enjoyed comparatively better …
Undoubtedly alternative energy and transportation innovator Elon Musk (Flickr photo: Jurvetson) – like his competitor for the taxpayer-funded, six-figure electric automobile market Henrik Fisker – is a smart guy. But will economic and technological realities humble him, or worse, make him look like a fool?
After the experience recounted last week by New York Times journalist John Broder, who test drove the Tesla Model S in frigid conditions that required frequent unplanned recharging stops throughout the Northeast, humility is out of the question for Musk. The jury is still out on inanity.
The Times published Broder’s devastating account on Friday. The plan was for the reporter to set out from the Washington, D.C. area and examine the claims that the Model S battery has a 300-mile range on a full charge, utilizing the carefully spaced new superchargers located at rest areas in Newark, Del. and Milford, Conn. – approximately 200 …
This story has been updated below.
The three top U.S. tycoons on Forbes’s “Green” billionaires list have received billions of dollars in taxpayer subsidies for their clean technology companies, after they spent hundreds of thousands of dollars for political campaigns and lobbying.
Two of the moguls, Elon Musk and Vinod Khosla (in photo), are technology pioneers based in California with net worths of $2 billion and $1.3 billion, respectively. The third, Christy Walton, is the widow of the late John Walton who was an heir to the Walmart fortune. Forbes says she is “the world’s richest woman” is worth $24.8 billion.
Significant percentages of Musk’s and Khosla’s value are derived from “eco-friendly” holdings. Musk’s main green investments are in Tesla Motors, an electric automaker, and SolarCity. Among Khosla’s clean-tech assets are KiOR and Gevo, both biofuels companies, and Calera Corporation, a company that uses captured carbon …