Last week I spoke about the electric car company’s co-founder suing the CEO for breach of contract and slander. This week, the company is back in the news, but for better reasons.
The Obama Administration will lend Tesla Motors $465 million to build an electric sedan and the battery packs needed to propel it. It’s one of three loans totaling almost $8 billion that the Department of Energy awarded Tuesday to spur the development of fuel-efficient vehicles.
Energy Secretary Steven Chu announced that the Department of Energy is also lending $5.9 billion to Ford to retool factories in five states. Nissan will receive $1.6 billion to refurbish a factory in Tennessee to produce electric cars.
These are the first loans awarded under the $25 billion Advanced Technology Vehicle Manufacturing Program which is meant to help automakers offset expenses caused by re-tooling to produce eco-friendlier cars.
The programs goal is to build cars that are at least 25% more fuel efficient than 2005 models.
“We have a historic opportunity to help ensure that the next generation of fuel-efficient cars and trucks are made in America,” the president said in a statement. “These loans — and the additional support we will provide through the Section 136 programs — will create good jobs and help the auto industry to meet and even exceed the tough fuel-economy standards we’ve set while helping retain our competitive edge in the world market.”
Last month, the Obama Administration announced that it is raising fuel-efficiency standards. These loans will help the automakers to achieve their goal of producing cars that get 27.5 miles per gallon today, to 35 miles per gallon by 2016.
Tesla said that the loans will help get their Model S sedan into production and on the road by the end of 2011.
“Tesla has long been counting on the loan to help it build the sedan it unveiled in March and had been in discussions with the agency for about nine months. It had sought $350 million to retool a factory to build the car and $100 million to manufacture battery packs and drivetrain components. Those packs and components will be used in vehicles built by Tesla and other automakers most notably Daimler, which recently bought nearly 10 percent of Tesla to jump-start development of the Smart EV.”
Tesla’s loan repayment will start within one year of the start of Model S production, and the whole loan must be repaid by 2022.
Should be interesting to see how this goes.
Click the link to view the original article on the Feds lending Tesla $46 Million
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