Santa Cruz Good Times

Friday
Sep 04th
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

 

You Are What You Post

Online personality algorithms put astrological profiles to shame, but UCSC psychologists are raising questions about sharing personal data

 

Venus Direct, Mercury Retro Soon, Honoring Our Labors

As Burning Man (nine days, Aug. 30-Sept. 7 in the sign of Virgo) burns in the hot white desert sands, a petal of the rose created by retrograde Venus and the twelve-petaled Sun in Virgo’s petals unfold. All of us are on the burning ground (Leo) in the womb (cave of the heart) of the mother (Virgo), gestating for humanity once again (each year) a new state of consciousness. Both Virgo and Cancer, feminine (receptive energies) signs, are from our last solar system (Pleiades). When humanity first appeared on Earth we were nurtured by the mother, a matriarchy of energies (on islands in the Pacific). Eve, Isis and Mary are part of the lineages of our ancient Mother. Overseen by the Pleiades, the Earth (matter, mater, the mother) in that last solar system was imbued with intelligence (Ray 3). As we move toward autumn, another mother, Ceres realizes she has mere weeks left with her beloved daughter, Persephone. Persimmon and pomegranate trees prepare for autumn, their colors signs of hope as the light each day continues to dim. Sunday, Venus in Leo turns stationary direct, yet continues in her shadow until Oct. 9 (when retrograde Mercury turns direct). Slowly our newly assessed values emerge from the Venus retrograde. We thought in Venus retro how to use our resources more effectively. Mercury retrogrades Sept. 17. Monday is Labor Day. Let us honor the labor of everyone, all life a “labor.” Let us honor Labor Day and all those who have “served” (labored for) us this past year. We honor their labors. We honor the labor of our parents, those who have loved us. We honor our own labors, too. We are all in service, we are all laboring. We are all valuable.

 

The New Tech Nexus

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

 

Girl Gone Wild

’70s SF recalled in raw, poignant ‘Diary of a Teenage Girl’
Sign up for Good Times weekly newsletter
Get the latest news, events

RSS Feed Burner

 Subscribe in a reader

Latest Comments

 

Sushi Garden

Local sushi empire expands to Scotts Valley

 

Do you overshare online?

I don’t think so. I just post things about my life, like successful things. Sometimes I just like sharing different news that I find interesting, or favorite artists, clothes, music. I like to post photos. Natalia Delgado, Santa Cruz, Server

 

McIntyre Vineyards

I recently met up with three friends for dinner at Sanderlings at Seascape Beach Resort. We chose to eat outside so we could watch the sun set over the ocean, but the Aptos fog rolled in and swallowed it up.

 

Sustainable Supper

The Homeless Garden Project’s Sustain Supper series supports its award-winning programs