Delivering a welcome victory for the government’s policy of supporting American manufacturing, Tesla Motors has paid off the loan it received from the Department of Energy nine years ahead of schedule, giving taxpayers a profit of at least $12 million on the original $465 million loan, Reuters reported.
“I would like to thank the Department of Energy and the members of Congress and their staffs that worked hard to create the ATVM program, and particularly the American taxpayer from whom these funds originate,” Tesla CEO Elon Musk said in a statement. “I hope we did you proud.”
The Advanced Technology Vehicles Manufacturing Loan Program, which was created under President Bush in 2007 and implemented by President Obama in 2009, has loaned out $34.4 billion to date, helping to create around 60,000 US jobs, according to the DOE.
Most of the loans, including $5.9 billion to Ford and $1.4 billion to Nissan, are being repaid on schedule. However, most of the headlines have naturally been generated by failing Fisker, which received $193 million before the DOE cut it off, as well as bankrupt battery makers A123 and Ener1, and solar power firm Solyndra, which received funding under different federal programs.
“The failure of a few high-profile companies has overshadowed the results of a larger number of companies that are meeting their requirements and are solvent,” said Alan Baum, an automotive analyst at Baum & Associates. “Of course, when non-payments occur, the companies move from low- to high-profile.”
“When you’re talking about cutting-edge clean energy technologies, not every investment will succeed – but today’s repayment is the latest indication that the Energy Department’s portfolio of more than 30 loans is delivering big results for the American economy while costing far less than anticipated,” said Energy Secretary Ernest Moniz in a press release. Moniz also pointed out that losses to date represent about two percent of the DOE’s total portfolio.
Representative Jim Jordan (R-Ohio), who held a hearing last month on Fisker’s loan, didn’t sound entirely convinced. “When they’re picking all these losers, it’s nice for them to have one where they can point to,” he said.
Also serving up sour grapes was Chrysler, which has shown the least interest in electrification of the US automakers. A blog post on the company’s web site took exception to Tesla’s claim to be “the only American car company to have fully repaid the government.”
According to Chrysler, “[in] 2011, Chrysler Group LLC repaid (in full and with interest) US and Canadian government loans more than six years ahead of schedule.” However, as John Voelcker of Green Car Reports pointed out, while Chrysler did pay off $7.6 billion in loans that were part of the government’s auto industry bailout (not the ATVM program), the administration also forgave more than $4 billion of debt as part of the deal, so taxpayers lost billions of dollars on their investment in Chrysler.
[Updated: 4/23/13 10:50am – added Chrysler’s comments]
Image couresty of NASA
Sources: Reuters, DOE, Automotive News, Green Car Reports, Chrysler, Tesla