Lazy Detroit Columnist Baffled By Tesla Getting A DOE Loan

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Detroit News columnist Manny Lopez just published a lazy, faux indignant, homer, column ripping the DOE for granting Tesla.

The gist of this column: “Why is the government giving money to a California electric car company that makes cars for the rich?” We liked this column better when Randall Stross wrote it for the New York Times last fall.

Let’s just start with this nitpicky detail Manny gets wrong: “$425 million to Tesla Motors Inc.” It’s actually $465 million. Maybe that’s an editor’s fault, no biggie.

He also misleads readers into thinking the government cut a big fat check for Nissan, Ford and Tesla . In reality, the government loaned them the money. At the risk of being naive, we’d like to point out that a loan typically means the money is paid back. 

Now here’s his attack on Tesla:

It’s no coincidence that the California company was awarded loans. It has friends in Congress who are making decisions without regard to facts and figures.

Right. Ford, GM, etc. DON’T have friends in Congress making decisions without regard to facts and figures. Just little old Tesla, who, by the way, has the only highway capable electric car out there.

If Tesla used the money purely to build its Roadster, it could produce another 5,300 or so, putting it just ahead of Maserati and Ferrari for full-year sales assuming it could sell all those Roadsters in a year.

That’s not what the money is for. That’s part of the deal. The company will develop a lower cost sedan.

Tesla has reportedly sold a few hundred Roadsters and with a price tag of $80,000 (reduced from $109,000 coincidentally just before the loans were announced) most of us will never get behind the wheel of one. Nor will we see its “cheaper” Model S gaining any market share. The sedan has a starting price of $49,900.

Of course it will gain market share. Right now it has zero market share. So going from zero to anything means gaining.

UPDATE: A reader points out that $80,000 isn’t the price of the car, it was the cost to build a Roadster that Elon announced in a blog post on Monday.

I’m sure these are fun cars to drive and the Roadster reportedly gets 244 miles per charge.

But that’s not how our dollars should be spent, propping up millionaires and billionaires, who, unlike their Detroit CEO brethren, fly in private planes when they’re not toying around town in their electric cars.

This is the most egregious error. Honestly, we’re baffled how it was even allowed to be printed. Detroit’s CEOs flew in private planes to ask Washington for money last November and December. After they were blasted for doing it, they opted to drive to Washington.

Hey Manny, since you can’t or won’t figure it out on your own, let us spell it out for you. Many technologies start off expensive, then come down in price, think of flat screen t.v.s or computers.

The government gave Tesla a relatively tiny loan to develop an electric car for the masses. Since Tesla’s already made an electric car once, there’s a pretty good chance they can do it again. That’s more than can be said of Ford.

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