Santa Cruz Good Times

Saturday
May 30th
Text size
  • Increase font size
  • Default font size
  • Decrease font size

In Defense of Tesla and Fisker

col_tesla-sThe two most prominent green car startups are Fisker Automotive and Tesla Motors, but a recent BusinessWeek article quotes longtime analyst Maryann Keller as saying, “We’re pouring $1 billion into two companies without a future. The economics of the industry favors large companies.” Is Obama wasting our hard-earned money? I don’t think so.

Of $8.5 billion in Department of Energy loans to automakers so far to build new green-themed plants, $465 million went to Tesla for work on its Model S sedan and, more recently, $528 million to Fisker Automotive for final design work on its $89,000 Karma luxury plug-in hybrid and for its more affordable Project Nina car. The total Advanced Technology Vehicles Manufacturing Loan fund is $25 billion, so much of the money remains to be spent.

BusinessWeek says this view is also held by “other critics,” but only quotes Keller. “Critics” in the article say that Fisker is an “integrator” rather than an innovator, buying the motor and battery technology for its Karma (due to roll off Finnish assembly lines starting in November) from other companies. Fisker responds that it built the Karma’s chassis. When I talked to an Energy Department spokeswoman in September, she told me that Fisker’s “two projects seemed to be worth the risk of the loan,” and would create “a large number of jobs in America.” She also said the loan, which will be paid in stages, would not “go out the door” until conditions were met.

She later said there was no deadline for the conditions to be met. Henrik Fisker said that those conditions were worked out in months of discussions with the agency. “It’s similar to a loan we might get from a bank and it’s not a problem,” he said. “The DOE wants us to be successful.” And when it comes to EVs, even many established brands are on a learning curve. General Motors does not make its own batteries, and Ford retained the Canadian company Magna International as its partner in building a Focus-based electric sedan for 2011.

Tesla, the article says, “has more credibility as an innovator,” since it makes its own battery packs and Daimler invested $50 million to buy a tenth of the company. “But it will be a huge challenge for either Fisker or Tesla to achieve sufficient scale,” BusinessWeek says. “Selling 100,000-plus cars a year requires a large network of dealers.” Tesla has seven dealerships now but is building more, and Fisker expects to have 100.

Tesla is perhaps the most fiscally successful of the startups, but the government money still dwarfs the $300 million the company has raised privately. But both Fisker and Tesla point out that the DOE funding is not in the form of a grant: It’s a loan, to be paid back with interest.

DOE funding also takes the form of matching grants from stimulus funds, and in August the agency named 48 recipients of that largesse, totaling $2.4 billion. The perception was that this funding favored Detroit and Big Three-connected suppliers. Start-ups, especially California-based ones, felt left out in the cold. We’re spending enough government money on the Big Three. The startups deserve investment, too.

 

Comments (0)Add Comment

Write comment
smaller | bigger

busy
 

Share this on your social networks

Bookmark and Share

Share this

Bookmark and Share

 

Ocean Odyssey

Sailing the high seas from Santa Cruz to French Polynesia, Sally-Christine Rodgers documents the trials, tribulations and joys of exploring the world by boat

 

Gemini Festival of Goodwill, World Invocation Day

This entire week is a preparation by the New Group of World Servers (NGWS) for the June full moon (Tuesday) and to welcome the Forces of Reconstruction, great outer planetary forces streaming into the Earth at the Gemini Solar Festival. The Gemini Festival at the June full moon is called the Festival of Goodwill and World Invocation Day (recitation of the Great Invocation, the mantram of direction for humanity, hourly around the world). During the (12 degrees) Gemini festival, the Wesak blessing of the will-to-good is released and radiated (Gemini distributes) to humanity. When the will-to-good is received, humanity is then able to radiate goodwill to each other and to the kingdoms. The Gemini Festival is the third of the Three Spring Festivals (triangle of Force), setting the spiritual template and resources for Earth for the rest of the year (‘til next spring). This festival recognizes the true spirit of humanity—aspiring toward and seeking the will of God, dedicated to right human relation. At the full moon, the Divine nature of humanity is recognized. Christ stands with humanity, leader of his people, “the Eldest in a great family of brothers” (Romans VIII, 29.) Each year at the Gemini festival, Christ preaches the last sermon of Buddha, His brother, a sermon calling forth human and spiritual unity, represented by an outflow of love (work of the Christ) and wisdom (work of the Buddha). The forces of reconstruction stream in during the Festival, ushering in an era of pronounced creative activity, rebuilding the tangible world on new creative lines. This necessitates the total destruction of the old forms no longer useful for the new world era. Everyone is invited. Join us everyone for this Festival of Goodwill by reciting the Great Invocation.

 

The New Tech Nexus

Community leaders in science and technology unite to form web-based networking program

 

Film, Times & Events: Week of May 29

Santa Cruz area movie theaters >
Sign up for Good Times weekly newsletter
Get the latest news, events

RSS Feed Burner

 Subscribe in a reader

Latest Comments

 

The Main Avant

Jozseph Schultz caters New Music Works’ 35th annual Avant Garden Party, plus brews for a cause

 

What will Santa Cruz be like in the future?

 society that is more awakened and realizes its own value and the beauty of the stunning Earth. Marguerite Clifford, Felton, Nutrition Health Care

 

Chesebro Wines

Piedras Blancas-Roussanne 2011

 

Real Thai Kitchen

Ratana Bowden on why Thai cuisine isn’t as spicy as everyone thinks