We’ve been waiting for several months to hear this good news. Three EV pioneers, Tesla, Nissan and Ford, are receiving loans from the Department of Energy’s Advanced Technology Vehicles Manufacturing program. Totaling $8 billion, the funds will be used to manufacture efficient vehicles and electric drive components. 
In Tesla’s case, they’ll receive a total of $465 million to set up their factory in Southern California for the production of their hot Model S. This car has generated a lot of interest given its superb styling, performance and efficiency. The price point of $57K makes it affordable for a large segment of the population. Part of the money will be used to set up a production line for their battery packs and electric drive trains to be sold to other manufacturers such as their new partner, Daimler.
Nissan will receive $1.6 billion to build EV and battery factories in Tennessee. Having experienced the drive train for their new EV, I am very pleased that this will enable them to ramp up quickly to 150,000 EVs annually. This car will appeal to a larger segment of the population given its price of around $30K. 
Ford is the big surprise for me. They’re getting the lion’s share of the money at $5.9 billion. They’ll use it to increase the efficiency of several of their cars and trucks. I assume some will go toward building their new EV with the help of Canadian parts supplier, Magna.
This announcement assures that large numbers of electric vehicles will be available to U.S. customers starting late next year and growing rapidly soon after. Additionally, tens of thousands of jobs will be created.
There will more announcements to come. I’m betting that Bright Automotive in Indiana will be on the next list of recipients.
8 Comments
Taxpayers do not have unlimited funds — but the government continues to spend money like it’s their own pocket book.
When capitalism’s business cycle veers into discomfort (unemployment, slowing sales and borrowing, etc.) — the State (government) now suppresses recession with monetary policy (making money cheap and abundant) and fiscal policy (quantitative easing, injections of liquidity, stimulus programs, etc.) so nobody feels pain. But the problems are still there, just hidden for a time by the bailouts. They will continue to grow until another bailout is needed (e.g. Chrysler).
Capitalists and those that embrace the free market reject this narrow notion for many reasons. Chief among them is that fact that experience and progress is the byproduct as we surmount difficulty. The Marines say, pain is weakness leaving the body. These downturns are inefficiencies leaving the system. These loans will be used to prop up inefficient systems. Nobody truly learns. Nobody truly grows. Nobody progresses.
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Stop the paronioa: You do not need to boycott car manufactures that accept bailouts. Capitalism thrives when you make a decision that fits you. You should find the car that you want — and that meet the criteria important to you. Car manufacturers that accept bailout money will be required to add inefficiencies to their business model and are at a disadvantage to produce the car that meets your needs the best. You should make car manufacturers and dealers compete for your business.
So if you are thinking about a car, check out this process on this blog: http://excarsalesman.typepad.com/
Sincerely,
Ford Fan
Screw Ford, why should they get $5.9 billion just to improve the efficiency of their vehicles. Tesla’s getting the least, and they are starting a WHOLE NEW VEHICLE PRODUCTION FACTORY.
I agree with Bob, Ford and Nissan shouldn’t get diddly, the money should go to Tesla, Aptera, and all the other smaller car companies that are doing really innovative things and need the cash to ramp up production.
Aptera for instance has a new hybrid gas-electric that can be plugged in like a pure electric and run off batteries but also gets 200mpg+ (yes, I wrote 200 – that’s not a typo!) when the generator kicks in. And yet, somehow, they haven’t gotten a single penny of the auto-industry bailout or any of this grant money.
Once again, giant companies get billions in corporate welfare while the real innovators starve. It’s absolutely disgraceful, the Obama administration should be ashamed.
This is actually a fair gamble. Nissan really has the best chance at mass-producing pure EVs in the short to medium term. As for Ford, they did not go into bankruptcy and must be encouraged to provide US alternative to the Prius and Insight.
Tesla is not starving. I’m still holding out for that sweet Model S.
It’s no surprise that the DOE gave the grants to the major car makers. Not one single electric car manufacturer got a dime. Global Green Cars has been all over the press with their record-holding electric vehicles and applied for $24 million under the same grant. Even though they aced the application, had their vehicle ready, and their matching funds, the DOE gave the money away in an advanced bailout program to the failed auto industry. This is an outrage. Fortunately, GGCI is still launching its 2010 model truck in spite of the DOE violation of federal law.
I agree with the other posters here, Nissan has the best chance out of the gate. Also Nissan and Ford have the best infrastructure; hopefully Ford will pull through for us. It would be irresponsible to give too much government money to Tesla, remember they shipped their first cars two years late, not to mention the management shake ups. I was very encouraged though to hear they turned a profit this month! Who knows? Maybe we will see a change in the marketplace? Tesla needs to earn our confidence a bit more though before they get too much money. I don’t think we should give GM a dime. They have shown time after time their contempt. Remember the Colbert report? I thought Lutz was going to attempt to redeem himself finally. Boy was I wrong. Wow, quite a revealing interview.
We pay our taxes and the government continue to speand it like it is there pocket money. Yes electric cars could help the environment but how much longer after that will they tell us to get rid of our electric cars and find another way to take more money of us? Although the govenment are making the right steps to help us in the future should this problem ever have happened if they though it through before ie why didnt we just run of electricity before?
Tesla is the only reason that Nissan and Ford get to vamp up EV production, and they got pennies compared to the rest. They were the original designers – I remember seeing them unveiled in the Guggenheim and reading about their production triumphs along the way… they had waiting lists three-years long because people appreciated that they are truly the most INNOVATIVE car company on the market today. Not to mention they are beautiful to look at. The only reason that they are so expensive is because they don’t have economies of scale yet, and until recently have been vastly on their own. Finally they are starting to get some attention and government handouts, but at a cost of selling their groundbreaking EV component to other car companies, only so that they can back-engineer it and undercut Tesla. You watch. It’s big-company/government croniesm once again and the big loser will most likely be the company that had the dream to make an electric car work while the unions were playing hop-scotch.