Published on May 23rd, 2013 | by Christopher DeMorro
Tesla Motors Repays $465 Million Government Loan
There have been plenty of doubters, haters, and detractors from Elon Musk’s electric car dream. For a while there his baby, Tesla Motors, was a political football punted between Democrats and Republicans. But with the full repayment of the $465 million Tesla borrowed from the U.S. government, Tesla has not just defied the odds, but proven the viability of a pure electric automaker.
Musk has been talking about repaying the Advanced Technology Vehicle Manufacturing Program loans early, but not this year. The loans weren’t due to be paid in full until 2022, meaning Musk and Tesla repaid them nine years early. The loan was repaid using some of the $1 billion Tesla rose last week with an issuance of common stock, and Tesla stock prices are hovering near $90 a share.
Repaid with interest, the government actually made money on its Tesla loan, though it will likely lose money to the collapse of Fisker Automotive and VPG. The only other two companies to receive money from the ATVM program, Ford and Nissan, are also no doubt well on their way to repaying their government loans in full.
It’s a huge day not just for Elon Musk and Tesla, but the electric vehicle industry as a whole. If Musk has proved one thing, it is that an electric car company can make money…and that’s a bigger deal than you might realize.
Source: Tesla Motors