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Will the Feds bail out the ICE makers, again?

Will the Feds bail out the ICE makers, again?

It's not looking good for the "big" 3 American automakers. Will the Feds step in and assist them again? If they do, would they offer TSLA anything?

TeslaTap.com | February 22, 2020

Considering they didn't do anything for Ford on the last go around, I don't see them doing anything for any car company that is not in bankruptcy while having a huge workforce at risk.

FISHEV | February 22, 2020

"If they do, would they offer TSLA anything?"

Tesla has gotten close to $3B in government direct loans and subsidies.

teslu3 | February 22, 2020

"$3B in government direct loans and subsidies." Have you web links to support this?
How much have other car companies received in the past decade?
Another view: https://cleantechnica.com/2018/02/18/tesla-subsidized-whats-truth-claims...
Are there any credible accounting reports for automotive loans and subsidies that include externalities?

jordanrichard | February 22, 2020

Fish is probably and incorrectly factoring the tax credit. Tax credit went to the buyers of the cars, not Tesla. Also, that tax credit goes to any EV.

Also, Ford didn’t get fed help, because they didn’t ask for it. GM and and Chrysler did.

SamO | February 22, 2020

Ford still owes $5.9 billion in unpaid loans to the federal government.

Receipts

https://www.google.com/amp/s/www.forbes.com/sites/joannmuller/2016/09/21...

jordanrichard | February 22, 2020

SamO, that I believe for sure. What often gets left about the money that Tesla did get, was that they paid it back 10 years early, where as you pointed out, Ford and I am sure GM still haven't paid their loans back yet.

SO | February 22, 2020

Ford was lucky to get a massive government loan (that they still owe billions on) right before the last recession. That’s what saved them.

TeslaTap.com | February 22, 2020

The Advanced Technology Vehicle Manufacturing Program loans made in 2009 were supposed to be for the development of EVs. It worked for Tesla and Nissan. Ford, seems to have used the money for other purposes and has not paid any of it back yet. Perhaps some will now be spent on the MachE. I don't think Nissan has paid back any of the loans either. Fisker went bankrupt and avoided paying it's amount back. Tesla in 2013 paid back the entire amount plus interest.

Ford: $5.6B
Nissian: $1.4B
Fisker: $529M
Tesla: $465M

@jordan - GM and Chrysler didn't want to make an EV, so they didn't take any money from this specific loan program. Being in bankruptcy may have also made it difficult for these two to qualify.

Geico | February 22, 2020

Rob,

What data to you have that supports any ICE Maker going bankrupt any time soon? It's quite the opposite, actually. But I'm curious to hear what you have to say. The only car maker doing bad in NA is Nissan, which is understandable.

Tesla, on the other hand, I would worry immensely about. Their cheapest vehicle is $40k and when shit hits the fan, people typically don't go out and buy luxury cars. Factor on top of that that Tesla's sales on the S/X side of the business was down 40% last year, and they are really screwed.

I don't forsee any economic downturn for the next 4-6 years. I think the market will continue to be a bull market until then.

Yodrak. | February 22, 2020

"Ford didn’t get fed help, because they didn’t ask for it."

Ford didn't ask for it because they didn't need it. Around the end of 2006 Ford mortgaged all of its assets, getting $23.6 billion from the mortgages. Ford had sufficient cash on hand to survive on its own, GM and Chrysler didn't.

"Ford still owes $5.9 billion in unpaid loans to the federal government."

Read your own cite again. Ford got a $5.9 billion loan, but the amount still owed - more than 2 years ago when the article was written - was $3.5 billion. It's less today and is scheduled to be paid off in 2022.

SO | February 22, 2020

Well...I guess Ford using taxpayer money for 16 years is slightly better than going bankrupt to where taxpayers pay for that too.

Earl and Nagin ... | February 22, 2020

@mabuck,
I suspect you're just another shill, however, if not, you clearly don't understand how most car dealers are so there's no reason to believe that you'd be able to understand how the ICE makers are going to go bankrupt in Tesla's presence.
@SO,
Taxpayers only have to pay for bankrupt companies if crony capitalists take it from us and bail them out. Now that Tesla exists, there will be no justification to bail them out any more than to bail out blockbuster, Smith Corona, or Toys R Us.

NKYTA | February 22, 2020

+1 E&N

jordanrichard | February 23, 2020

TT, sorry, I meant government assistance GM and Chrysler got when they were bailed out.

Geico | February 23, 2020

I guess no one has any information that would support their claim that the Legacy automakers are going bankrupt?

Geico | February 23, 2020

FUD

Earl and Nagin ... | February 23, 2020

@mabuck,
I don't have any "information" to support the claim but I did purchase (lease actually) my first EV 21 year ago. Also, I purchased my first Tesla 14 years ago this summer and I did buy my first TSLA shares at $17/share. Clearly, in this area, hindsight shows that my foresight isn't too bad.
There are a lot of other indicators the EVs are going to dominate ICE including:
- safer
- cheaper (you have to extrapolate to understand this one)
- better handling
- better accelerating
- less maintenance
- cheaper to fuel
- cleaner
- sustainably fueled
- quieter
The above show that EVs will most likely dominate the future of land transportation from a technical and customer satisfaction perspective.
Now, if you look at how much effort Tesla is expending on improving and cost reducing their EV technology compared to how much the legacy ICE automakers are, you'll see that Tesla has the huge lead
Then, you look at who has been expending massive R&D money and implementing technology to desperately try to preserve the status quo including complex ignition and combustion schemes, horrendous numbers of gears in transmissions, and Plug-in Hybrid technology which increase the ICE costs and further reduce their margins.
Furthermore, if you look at how hard so many people (including, most likely, your employer) are fighting them, clearly there are many people in very powerful positions that also understand that they are threatened.
Other than that Mr. Conestoga, what else might you want? Fortune teller proclamations?

Geico | February 23, 2020

So you change the narrative to fit an argument that has nothing to do with OP in order to win and get engagement that fits your knowledge structure? Nah, I'll pass.

SO | February 23, 2020

I don’t have any hard evidence of car companies going bankrupt. The only example I found was Ghosn saying Nissan will be bankrupt within 3 years.

https://www.motorauthority.com/news/1126832_ghosn-nissan-will-go-bankrup...

The future looks brighter for Tesla than it does for the legacy car makers. Wall Street seems to think so anyway. At least for now. They can be a fickle group too though.

SamO | February 23, 2020

Troll tactics 101.

Ask a question, then ignore the answer when it hurts your employers feelings.

Ford has lost its way. Stock down 50%. Huge debts. Falling sales. No path forward. Sunk costs.

Bankruptcy imminent.

Mach-e is a Hail Mary with a subpar product. It is not a Tesla Kilmer, not a very competent competitor. And if it sells decently, then it will Osborne the other 99% of Fords product lines.

THis isn’t going to end well. But it will end soon.

Geico | February 23, 2020

@SamO

What data do you have that supports Ford going bankrupt other than knee jerk comments? Stock doesn't influence profitability, Sales falling? No path forward? care to explain?

FUD

SO | February 23, 2020

Correct. Stock doesn’t influence profitability. But it is considered a method of measuring future profitability.

Earl and Nagin ... | February 23, 2020

@mabuck,
For a supposed country bumpkin you seem to have read the troll and FUD playbook quite well and execute it nearly to the letter.
You even seem to work hard on Sundays!
Good job!
I hope you get a good bonus this quarter so you can finally afford a Tesla and be one of the cool kids again.

SamO | February 23, 2020

$100 billion in ICE investment by Ford that have to be written down/off. They are the blackberry of automakers.

Geico | February 23, 2020

Thanks, but I like to stay objective in my opinions and not be a part of the Tesla Cult that so many shareholders pin themselves into.

You know, it is OK to actually bring fact and logic to a discussion, right? All I want is proof that any Auto maker is going bankrupt soon other than Nissan which I already stated.

Geico | February 23, 2020

@SamO

Ok, is Ford not paying that debt down? Is that really all you have to persuade potential readers of this Thread?

SamO | February 23, 2020

I’ll repost from above since you have zero answers:

There are a lot of other indicators the EVs are going to dominate ICE including:
- safer
- cheaper (you have to extrapolate to understand this one)
- better handling
- better accelerating
- less maintenance
- cheaper to fuel
- cleaner
- sustainably fueled
- quieter
The above show that EVs will most likely dominate the future of land transportation from a technical and customer satisfaction perspective.
Now, if you look at how much effort Tesla is expending on improving and cost reducing their EV technology compared to how much the legacy ICE automakers are, you'll see that Tesla has the huge lead
Then, you look at who has been expending massive R&D money and implementing technology to desperately try to preserve the status quo including complex ignition and combustion schemes, horrendous numbers of gears in transmissions, and Plug-in Hybrid technology which increase the ICE costs and further reduce their margins.

ICE is the past. Ford has 100B invested in ICE which will never pay for itself. They have the capacity to build 10,000 EVs per year and it costs a lot to add capacity. They are already maxed out and have no money to join the EV future.

If that’s not clear enough English...well... I can explain it to you but I can’t make you understand it. I’m reminded of an Upton Sinclair quote often when dealing with astroturfing trolls:

"It is difficult to get a man to understand something when his salary depends upon his not understanding it."

Geico | February 23, 2020

@SamO

So you change the narrative to fit an argument that has nothing to do with OP in order to win and get engagement that fits your knowledge structure? Nah, I'll pass.

"ICE is the past. Ford has 100B invested in ICE which will never pay for itself. They have the capacity to build 10,000 EVs per year and it costs a lot to add capacity. They are already maxed out and have no money to join the EV future.

If that’s not clear enough English...well... I can explain it to you but I can’t make you understand it. I’m reminded of an Upton Sinclair quote often when dealing with astroturfing trolls:

"It is difficult to get a man to understand something when his salary depends upon his not understanding it."
"

ICE is the past? Well yeah, and the present as well. An EV still can't be produced cheaper than an ICE, so not sure why you think ICE is going anywhere?

"They are already maxed out and have no money to join the EV future."

Did you know ford invested 11billion into EV and it's EV architecture? That is roughly 1/3 of ALL of Tesla's assets. Ford also has 34 billion cash on hand, or pretty much the entire company (assets) of Tesla in cash.

EV's accounted for only 2,000,000 units worldwide in 2019. How many ICE vehicles were sold? Tens if not hundreds of millions when you factor in the used car market.

Geico | February 23, 2020

"hey have the capacity to build 10,000 EVs per year and it costs a lot to add capacity. They are already maxed out and have no money to join the EV future."

Where do you pull such BS from? Ford has a dedicated battery plant with LG in poland that produces batteries specifically for them 24/7. That battery plant will be producing batteries for their Mach E and Transit series, and just on the Mach E alone they will produce at minimum 50,000 vehicles per year. Not sure on the transit van numbers. Reports are that they can scale that production to 100s of thousands per year based on demand.

Geico | February 23, 2020

SamO continue's to push lies and FUD.

rob | February 23, 2020

@mabuck
So, how much of Ford, GM and Chrysler is currently owned by US Gov?

akgolf | February 23, 2020

Shorters are busy.

Geico | February 23, 2020

You tell me? You’re the one who claims they’re going to need gov assistance again.

NKYTA | February 23, 2020

@mabuck, time for a new gig. You are not “winning”.

sabbia | February 23, 2020

Thanks Earl & Nagin

sabbia | February 23, 2020

Meanwhile A Harvard Law School student writes in the Washington Post that Liberals love EVs...the rest of America not so much.

Ashley Nunes is the author and she posts clearly misleading information (old stories about the cost of manufacturing of EVs from an old Union of Concerned Scientists article while ignoring that same organization's newer data).

All of the article puts the question in political terms (Democrats this, Democrats that, Liberals this, Liberals that) and barely a scintilla of fair and balanced discussion.

https://www.washingtonpost.com/outlook/2020/02/20/liberals-love-electric...

As to the request for information about the potential of Ford's bankruptcy, note that Ford's debt has been downgraded by Moody's and is just a smidge above junk status. https://www.ccn.com/why-bankruptcy-forgone-conclusion-for-ford-motor-com...

This is not to be wished. While there is a future for ICE vehicles (think dense urban areas with little room for recharging stalls and no owner garages) the ICE trolls are beginning (rightfully) to panic.

Earl and Nagin ... | February 23, 2020

@mabuck,
Quit your bellyaching:

". . . ford invested 11billion into EV and it's EV architecture" -mabuck

This is completely consistent with:

". . . who has been expending massive R&D money and implementing technology to desperately try to preserve the status quo including . . . Plug-in Hybrid technology which increase the ICE costs and further reduce their margins."- Earl & Nagin

Ford invested in wimpy plug-in hybrids that only got 20 miles of EV range and the owner had to sacrifice 30% of the trunk space and the trunk-pass-through to get it.
The hybrid architecture kept the status quo (all business areas got some revenue) but they weren't what the public wanted. Essentially, they've been wasting all their money.
That is how a company goes bankrupt.
Tesla has been spending their money wisely. No "Cult" required. Logic handles it all.

SamO | February 23, 2020

Point out a single “lie”. I’ll wait.

Meanwhile getting paid a penny or nickel per word is the best that the dealerships and the ICE world has to offer.

Longtime owners and friends of Tesla have seen your type before. Posting numerous articles on the longevity and future of IcE. How dealerships are really a benefit to humanity. What about the little league sponsorships?

Lol.

You are much better off changing your handle and trying a different tact. You’ve been unmasked for the shitbag you are.

Geico | February 23, 2020

So this thread has been hijacked by multiple people who change the narrative to fit their knowledge structure?

I’ll wait. Do go on and explain which ones are going bankrupt soon.

Tropopause | February 23, 2020

mabuck,

Go buy a Tesla and you'll understand why ICE is DOA.

FISHEV | February 23, 2020

"Fish is probably and incorrectly factoring the tax credit. Tax credit went to the buyers of the cars, not Tesla."

Tax credits are to boost sales of EV's and every evidence they do exactly what they are designed to do. So Tesla received over $2B just in the EV subsidies. Tesla will take the subsidy directly when leasing.

SamO | February 23, 2020

More happy horseshit from king troll and his progeny.

“Tesla received” nothing.

But keep shitposting.

Tropopause | February 23, 2020

Great! Give Tesla another "$2B" in "EV subsidies". Tesla is the only US car company growing, let alone making EV's profitably.

We should help winners, not losers.

FISHEV | February 23, 2020

"Tesla is the only US car company growing, let alone making EV's profitably."

Now lets keep it real. Tesla has not made a yearly profit yet.

" Give Tesla another "$2B" in "EV subsidies"

All for it. The EV tax credit should be upped to $15k for full EV at 250 miles or more and changed to a cash rebate vs. a tax credit. Working people could apply it to car purchase upfront.

Earl and Nagin ... | February 23, 2020

come on Fishy!
First it was "they lose money on every car and they're expensive cars"
Then "They're still losing money on every car"
Then "They have never made a profit"
Then "They have never made a GAAP profit"
Now this is the best you can do? You didn't call anyone any names in this at least like your buddy has been. Consistency is important.
Are only the interns working on Sunday? Hopefully, we can hear from the first stringers during the work week.
Seriously kids, either you're not cut out for this job or the game is over with a wipeout.

SO | February 23, 2020

Mabuck - you holler about people here being “cult like.”

Do you realize how you sound when you defend the practices of dealerships and glaze over the fact that GM and Chrysler recently filed bankruptcy and Ford only skirted it by taking out a huge loan? Got news for you....you sound “cult like”.

Geico | February 23, 2020

Yeah, I can see that @SO

The thing is, I'm trying to stay on subject and actually discuss why certain automakers would go bankrupt. Nissan, that's an easy one. Others - not so much.

No one here has yet to offer any compelling evidence, so it's clearly FUD.

TeslaTap.com | February 23, 2020

I don't wish bankruptcy on any company (well maybe some of the mass polluting oil companies, but that's not going to happen).

The concern with the big three is how little the market believes in these companies. Very low valuation is not anything Tesla owners or posters here have any control over. The major analysts and huge fund managers are the ones who don't believe the automakers very much do not want to invest in the stocks resulting in poor market capitalization. This is likely due to continued sales declines on top of massive debts. If the economy floats along as it has, perhaps there will be little change.

If a recession happens, GM/FCA/Ford are all going be in very precarious positions - far worse than Tesla. Consider the product mix is 90% gas guzellers. During a recession, people stop buying these huge SUVs and trucks and turn to high-efficiency vehicles - something none of the big three make anymore.

Keep in mind Tesla weathered the last recession quite well. When you produce products that people want, without even needing to advertise, it's a huge advantage. Tesla could start advertising and double sales overnight, but they are capacity constrained. Others are shedding plants as fast as they can while spending billions on advertising to try and keep the sales going.

Sorry, no FUD. Let's hope we don't go into a recession - but there are so many world issues that could easily cause a recession - Covid-19 virus, tariff wars, real wars, consumer debt explosions, and more. Tough times we live in right now.

teslu3 | February 23, 2020

Don't neglect the Paris Accords and plans of various nations with goals to reduce or eliminate carbon emissions. With such goals, which (American) vehicle manufacturers are likely to thrive? Which are likely to become dominant world players in the next decade or two? Is the USA positioning itself to be the greatest? Or is this considered a hoax and it's just fine to let other countries develop the technoloigies and own the IP?

Yodrak. | February 23, 2020

"Is the USA positioning itself to be the greatest?"

Oh boy, I'm not gonna touch that one.

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