Cycles Elio Motors Town Hall

Published on August 16th, 2014 | by Jo Borras

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Elio Motors Has a Town Hall Meeting, I Go To It

Elio Motors Town Hall

Earlier today, I was invited to listen in on a “Town Hall” sort of meeting between Paul Elio and his fans at the Elio Motors Owners’ Association (EMOA). The meeting was very open, with Paul answering questions very candidly and convincingly and generally appearing to know what he was doing. There were a few “expected” questions about timeframes and deadlines, of course, but the big news of the meeting was that Elio had, as of Thursday, officially applied to the DOE’s ATVM loan program seeking $185-200 million in federal monies to begin production at the company’s Shreveport, LA factory.

Neat stuff, then, and I’ll do my best to give you all a sense of what my experience at the Elio Motors town hall meeting was really like, below. Enjoy!

 

Elio Motors Town Hall Meeting | Aug 2014


The meeting started right on time, around noon CST, with most of the attendees apparently recognizing each other from past Elio events and EMOA meetings. As soon as Paul Elio came on (the guy in the lower right box, above), the banter turned to him and the Woodward Dream Cruise, where Elio is showing his trike and taking reservations (more on that, shortly). After a few minutes of this, Paul opens up the floor to questions.

The first question, right out of the box, was about Elio’s new, proprietary internal-combustion engine, and when it would be ready.

Paul (paraphrased): Production volume in the US is up to almost 17 million this year, so everything is clogged up. Our parts are in line to be machines, though, but we may be a few weeks late on the reveal. “We’re getting there,” he says, seeming not terribly concerned that this hold up would delay the already delayed production launch further.

The second question- indeed, the second set of questions- was a bit more interesting, and delved into the fact that Elio’s first batch of vehicles would be sold with OBD-I, vs. OBD-II. That’s legal, of course, because the Elio Motors trike isn’t a car.

Paul (paraphrased): I don’t know that we’re committed to OBD-I, but we’re still looking into it. In regards to bi-directional communication between the user, the user’s devices (Apple’s iPad was the device mentioned most) and the vehicle, Paul said “We’re passionate about it, but we don’t want to integrate that technology.” “That technology” refers to the infotainment system in the car. Elio told a story about one of Elio Motors’ board members, Stu (Stuart Lichter, surely?), who drives a Maserati. According to the story, Stu’s son wants him to trade the Maserati in because, “the Nav sucks.”

Paul goes on to mention that he wanted to off-load a number of optional features, like cruise control, to an iPad interface through something like an app, but that his suppliers balked at the idea/liability.

Next, Elio began discussing “sales” figures (I’m using the scare quotes because Elio has reservations, not sales) and finances. Paul commented that Elio Motors had collected some 4400 reservations in June of 2014, outselling more established and storied car brands like Mitsubishi, Lincoln, and Acura.

At this point, I tried to call “bullshit” on the whole meeting, because I can look up a company’s sales volumes just as easily as the next guy, and I found that Mitsubishi had sold over 6000 units, Lincoln had sold over 7200 units, and Acura had moved more than 11,200 units in the same month. Those are numbers which, you’ll notice, are much larger than 4400. In a phone conversation after the meeting, Paul clarified. “We’re comparing car-to-car, not the whole company,” he explained. “If you take out SUVs and just look at individual car numbers, 4400 beats all of them.”

As ridiculous a saying as “ignore trucks and SUVs” might be when it comes to discussing American vehicles, I’ll leave that one alone (besides, 4400 really is more than any individual Acura, Mitsubishi, or Lincoln car line sold).

The meeting goes on, and we get to the big news out of Elio this week: Elio Motors has officially applied for federal monies through the Department of Energy’s ATVM Loan Program. It’s a ballsy move, and one that might alienate Elio Motors’ Tea Party/NRA fan base, but Paul anticipates a negative response and cuts it off with “whether or not I agree with the ATVM Loan Program doesn’t matter. It exists, and- as a CEO- it would be irresponsible for me not to apply for it.”

As a dedicated Ayn Rand Objectivist in my youth, I refused to list my ethnicity as “Hispanic” on a number of scholarship and financial aid forms in a bid to, you know, sleep at night. That said, I knew plenty of better people than me who spent weeks trying to dig up some kind of Inuit/Native American ancestry in order to qualify for some scholarship or other, so who knows? Maybe that’s responsibility these days. To his credit, though, Elio avoids any further politicizing and keeps things upbeat.

Paul (paraphrased): I talked to them informally the day after we applied. It seemed pretty positive. We uploaded the financials a month ago, but we weren’t audited. There’s a check box at the end of the loan application, which is entirely online, and if you say you weren’t audited then you don’t get the loan, is what I was told. So, we contacted Stu Lichter and used his auditors to get our numbers together and it was officially submitted yesterday. We feel like the response has been positive.

That move towards government funding shouldn’t be a surprise, especially considering that the minutes of a May 20th Caddo Parish meeting between Parish commissioners and Mr. Elio clearly state that Elio would be seeking $200 million from the Federal Government …

CADDO PARISH / ELIO – MAY 20 MEETING MINUTES
Click to enlarge. Click to enlarge.
CLICK THE PAGES TO ENLARGE

… which, Elio says, will follow a round of investment currently in the works that, when added to the DOE loan, will bring the company an anticipated $230 million. More than enough, in other words, to get the production ball rolling in Shreveport.

 

Elio Motors Town Hall Meeting | More Qs


With Elio Motors’ big news out of the way, talk more or less circled back to the vehicle, itself, and some of the issues that have been brought up every time the trike comes under scrutiny.

First up was a question about the Elio’s status. Is it a car, or is it still a motorcycle? “Am I understanding it correctly,” ask the woman, “that the law-changing [sic], from motorcycle to a car, is State by State?”

Paul (paraphrased): We’re creating a new category that’s a motorcycle, but it’s defined as having a roll cage, seat belts, anti-lock brakes and traction control. Not particularly controversial, and the only place they weren’t successful was in Arizona. That was mostly due to a rider attached to the autocycle bill that would have allowed people to drink beer on a 6-passenger cycling bar. Worst case is that people need to go to the DMV and take a test.

I’m not sure that’s the worst case, but Paul’s selling here, and he’s playing to his most dedicated fans- a fact that becomes immediately apparent once the talk turns to “V4″ vs. “V5″ prototypes and, what Paul called, a “triage” that Elio is using for its suppliers. “We do use a triage,” he says. “We put American based companies that manufacture in the US at the top of the priority list, then foreign companies that manufacture in the US, then foreign companies manufactured outside the US to fill in the gaps that we can’t fill, otherwise.”

“What kind of gaps?” someone asks, before asking, more specifically, about the vehicle’s HVAC systems. Paul goes into surprising detail here, saying that, “We couldn’t find a North American supplier that could meet our needs. We were looking at the Calsonic unit that was actually the rear AC unit in the Nissan Quest, which isn’t being made anymore in sufficient volumes to meet our needs. We have found one offshore unit that meets our cost needs and our standards for quality, but, as of right now, my only viable solution is not in made the US.”

More questions about prototypes and Elio’s plan to build 25 to release to the press. “We’re waiting for the current round of funding to close in order to kick off the production of 25 prototypes,” he says, before explaining that he’d be happy to set up press drives with journalists and vocal enthusiasts who can make to their road show events. That brings up a question about curb clearance on the Elio trike’s spats (the aerodynamic wheel coverings over the front hubs).

Paul (paraphrased): There is a specific test with, essentially, a 4″ pothole. That’s been done, and the design isn’t finalized, but we’ve done the test and the next version will be 100% right.

There are more questions about being able to flat-tow the Elio behind an RV (you can) and adding a tow hitch to the back (you can’t). It’s all pretty normal stuff, and there’s talk about setting up a virtual store where reservation holders can “vote” on accessories and add-ons to help give “tier 1 suppliers” a sense of what might be popular with buyers. There’s a confirmation about Elio reservation holders getting their vehicles first, before anyone else, to be followed by fleet and commercial buyers.

At this point in the meeting though, things started to get really weird.

One of the EMOA members starts to complain that, even on the EMOA FB page, “there are too many nay-sayers, too many doubters,” and that he’s now actively avoiding the other forums. At that, a few other EMOA members start to chime in, with one of them asking, “What can we do to help get the word out.” Elio doesn’t respond, and answers another question someone asked about power steering (there’s room for it, but they think it’ll be a “year two” option, by the way).

Again, the same question. “What can we do to get the word out? What are some of the ways we can help spread the word about Elio and push people to make reservations on Facebook and other social media?”

Elio’s PR guy gets on the meeting, and talks about Elio’s priority being to “maintain transparency and authenticity”, which is admirable, but largely ignored.

“Do you have a form letter?” asks one attendant. “Yeah, like ‘a form letter to the editor’ we can post online,” says another. “A lot of us hand out fliers throughout the day, so if we had a form letter it would really help,” says the first one, again. Before Elio’s people can answer, a woman shouts out, “Can I wrap my car in Elio advertising!?”

It is a weird and unsettling scene.

To his credit, Elio deftly ignores the nutter questions, and diverts talk of the wrap to Elio’s plans to offer a full vehicle wrap as an option. He goes on to talk about the appeal of his three-wheeled vehicle as “a great rural vehicle”, and rightly points out that when a gallon of milk is 15 miles away and your only option is to go to the store in “your farm truck that gets 12 MPG”, then the Elio vehicle “starts to make a lot of sense.” Despite the fact that even full-size, 4WD luxo-barge SUVs are getting better than 25 MPG these days, it’s a comment that resonates with the group.

They all nod and make in-jokes, trying to get Elio to laugh with them. He does so, politely.

 

Elio Motors Town Hall Meeting | Final Thoughts


Paul Elio has balls.

That needs to be said. In an era where the CEO and chairman of Ford hemmed and hawed over their answers to questions as seemingly simple as “How is Ford working to deliver more zero-emission and electric cars?” (Hemmed and hawed, mind you, at a meeting they invited us to, that was specifically about clean tech and renewable materials!), Paul Elio reached out to some of his toughest critics, looniest fans, and steadfastedest supporters to come to, essentially, an open forum webinar. He invited them to ask their questions, and engaged each and every one of us both humanly and humanely.

Balls, man.

I talked with Paul, by phone, after the meeting, and he voiced his frustrations with some parts of his journey. “We’re doing so much great stuff and there are so many exciting developments, but we can’t talk about any of them yet!” he said, sounding fully like a man who was on the verge of jumping off a bridge, fully convinced that he could fly. “If you look at our numbers, you can see that the sales are going to be there,” he says, with the same enthusiasm. “It’s going to happen.”

I can’t speak to whether or not Elio Motors is going to make it. I think they have some real obstacles to overcome, and I think that $6800 intro price is something that’s way, way removed from reality (if they went to production today, they’d cost $7300, Paul admitted), but I don’t think any of that matters. Paul Elio, the more I talk to him, seems to be exactly the right kind of clever / insane to pull something like this off … especially if he can convince the American taxpayers to cover the bills.

 

Original content from Gas 2.




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About the Author

I've been involved in motorsports and tuning since 1997, and write for a number of blogs in the Important Media network. You can find me on Twitter, Skype (jo.borras) or Google+.



  • J_JamesM

    It’s a bit disconcerting that Elio seems to think this is in the bag. There is a LOT that can go wrong yet… Even if production miraculously delivers on the promise of a halfway safe, halfway reliable vehicle with those standard features and at that price point, there’s always the danger that the people who reserved one are the only ones that are actually interested in buying it.

    Then there’s the distant, looming specter of bad press, recalls, safety concerns, etc…

    • http://www.insteading.com/ Jo Borras

      I don’t think he feels like it’s “in the bag”, but keep in mind that, regardless of what he says, Elio could push forward with a ton less money. He needs that money to hit his volume of 250,000 units annually. I don’t think he will, but I live in a major city, own multiple cars already, and I’m not afraid of either motorcycles or rain, so I’m not the guy he’s trying to sell to.

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  • Offgridman

    Thanks for the article, but once again Elio is going back on a promised feature. I got very interested last year, but am one of those farm country customers that is concerned with bringing more back from the store than a ‘gallon of milk’, or even more groceries than might fit in the storage and back seat area.
    So have an email communication from their customer service supervisor promising that it will be possible to attach an after market motorcycle tow hitch. He said that they were already communicating with a few different companies on this and there would be at least two options.
    Of course there have already been several disappointing issues with them including the continual delays on production, and the poor engine design with its very minimal drive train warranty, so I never did get hooked into giving them any money.
    Maybe after a couple of years of production (if it ever happens) and seeing what kinds of issues the first time buyers have, I will reconsider and get one. But suspect that by that time EV’s will be doing so well, with a much better variety of choice and warranties that the Elio won’t be worth considering.

    • Jason Cole

      I’d wager Elio was referring to a full-size ball hitch, and not a motorcycle hitch. I could be wrong, though.

      • Offgridman

        While different sized balls are used according to the size and weight of what you are towing, and of course how tow packages connect to different vehicles is going to be different. The tow balls used between automobiles and motorcycles are the same standardized equipment except in the case of specific manufacturers adding their specific towing adaptors for their own equipment.
        Just going by the quote in the article “tow the Elio behind an RV (you can) and adding a tow hitch to the back (you can’t)” goes totally opposite to the information Elio gave me in writing this past February.

        • http://www.insteading.com/ Jo Borras

          To be fair, this was an informal sort of gathering and the comment was that there was no provision to wire a trailer into the trike. I guess you could still tow a “dumb” hitch.

          • Offgridman

            Okay now, to be fair, that is not what you said in the article. The great majority of cars and bikes don’t come with pre wired trailer lights. That’s why most tow kits come with a plug and clips to connect to the vehicle harness.
            I’m not quite sure what you mean by a “dumb” hitch, I have lived in every state on the US eastern seaboard and every one of them required lights on trailers. Whether brake, tail, or signal, or all three.
            I am not upset over this but you have got me doing complaining about the Elio company over inaccurate reporting. There is a big difference between not having the ability to connect a tow hitch, and not having the wiring ready to connect that trailer once you mount a hitch.
            Hope you don’t get offended over my saying this, but Jo get your s*** together.

          • http://www.insteading.com/ Jo Borras

            That’s how the question was worded and answered. So … yeah.

          • Offgridman

            Fair enough.
            Thanks for taking the time to reply.

    • http://www.insteading.com/ Jo Borras

      It’s unfortunate that they don’t find a way to simply and easily attach saddle bags to this thing, the way the TRex guys do.

      • Offgridman

        That would be helpful, but with the way the Elio is designed would throw the aerodynamics and mileage out the window.
        I had just hoped to use one of the small pod trailers, like the highway cruiser bikes and add a yard or two of capacity,. But if they are now saying it isn’t possible to add a tow hitch it would likely void the warranty and make any insurance claims invalid in case of an accident, so removes a lot of the usability for myself.

  • tdperk

    “As ridiculous a saying as “ignore trucks and SUVs” might be when it comes to discussing American vehicles, I’ll leave that one alone (besides, 4400 really is more than any individual Acura, Mitsubishi, or Lincoln car line sold).”
    That line strikes me as you thinking it’s ridiculous to compare apples to apples.
    “especially if he can convince the American taxpayers to cover the bills.”
    Little divergence from reality here, he wants the taxpayers to front the money and take risk to that amount, that he can’t pay the bills. He’s not asking us to cover the bills.

    • http://www.insteading.com/ Jo Borras

      You can’t play that “apples to apples” BS game here, kiddo. Since when is comparing “a partial deposit made on a 3 wheeled vehicle that hasn’t been built” an apple to compare to an apple made up of “a four wheeled, 4+ passenger car that has actually been built, purchased, and delivered to an end user for 3-6x the price of an imaginary trike”?

      As for the taxpayer covering his bills, why do you think that taxpayers “fronting the money” is different? What do you think he’ll use that money for and who do you think will get paid back (or, rather, fail to get paid back) if the company goes under?

      You sound ridiculous.

  • Kent Beuchert

    I see Borras is up to his usual illogical and nonsensical arguments – now claiming that the Elio sales should be compared to an entire auto company’s lineup, including SUVs, space ships, and apparently kitchen stoves as well, if the automaker builds them.etc. Unbelievable.
    The Elio succeeds because it takes advantage of designs that conventional automakers always sneered at – a two seat tandem arrangement, which provide the aero number required for the 84 MPG, the removal of all extraneous stuff – that fourth wheel, that second door, rear window, etc. The windshield washer setup is a stroke of genius- a system that is not only clearly superior, but cheaper as well. Ditto for the hood latch system. This car is far and away the most significant vehicle since the Model T,whose advantages it closely mirrors. Equally astounding is the potential for this vehicle to follow in the footsteps of the Model A , when modified as a hot rod. With even a mild turbo added (IAV is designing one on their own) the Elio becomes a pocket rocket – running to sixty in well under 6 seconds. In terms of emissions reductions, it’s a simple matter (not necessarily for mathematically -challenged Borras) to calculate just how much this vehicle blows away the Model S – head to head, highway, the Elio produces less than a fourth the Model S emissions. Dollar for dollar, the Elio makes govt subsidies of the Model S appear the work of a Tesla stockholder. The Elio beats the Model S in this venue over 40 to 1 in emissions reductions. Even in gasoline consumption reductions the Elio bests the Model S by at least 6 to 1, on a dollar basis and about 60% on a car vs car basis. Only the really, really stupid can support govt money for a Model S and not an Elio. Which brings us to Jo Borras, who , in the past , has maintained an incredibly ignorant hatred for the Elio (as if the world cares). Paul will sell a billion of his excellent three wheeled vehicles. How many cars will Borras sell?

    • http://www.insteading.com/ Jo Borras

      The problem with everything you just said is that the Elio solves a problem that very few people have. Let’s say it solves a problem that 4 million people have in the US. That’s 1% of the population. Of that 1%, maybe half (if that) will spend their car budget on a single-mission vehicle.

      I guess what I’m saying is that I think your enthusiasm is ludicrous, and your insistence that the cheapest offering in a given segment (in this case, the auto segment) will move the needle in terms of public interest simply ignores the standard diffusion of innovations model that dominates modern economic thought.

    • AZ

      Although I’ve had problems with Borras’ articles in the past, I found this one very fair. Don’t think the comparison of Elio reservations to sales of an entire brand is fair? Fault lies with Paul Elio making the outrageous comparison. Not comparing apples to apples? No. Compare it to a car with sales similar to what Elio expects to sell. Compare it to an economy car or entry level vehicle from a major manufacture. Mitsubishi hardly a major, and ready to pull out at any time. Yeah compare Elio to luxury car brands, that entirely makes sense.

      When has the government given a loan to a motorcycle manufacture? The Elio is classified as a motorcycle. I don’t want to hear how this enclosed, has airbags, etc. until Paul Elio petitions the feds to have this classified as a car. Why do you think Elio went to the states to have the helmet law waived, instead of to the fed’s to have this classified as a car or some other new classification?

  • Hayden

    Great article! Very refreshing to read something on this topic that sounds like a real work of journalism instead of reissuing some old press release.

    One thing I would ask if you have contact with Mr. Elio, I would stress offering power steering and power brakes in the first cars. All real cars today are expected to have PS and PB’s. ABS suggests a brake system that has assist worked in, but I saw one video where a female reporter seemed very surprised that the P4 didn’t have it. I would suggest fielding mock accessory requests from all in reservation holders like myself to prove my point that this is an essential minimum option.

  • Budsygus

    I’ve been following Elio for months and am EXTREMELY hopeful their product makes it to market the way they keep saying it will (price, features, etc. intact). This was a great article and I appreciate every bit of skepticism people can throw at this. If it’s going to fail, I want it made public earlier rather than later. It looks like they’re on track (though delayed, which surprises no one I would think), so I just hope it all pans out.

    Mr. Borras, keep the news coming.

  • Jeffkan1

    Skepticism is everywhere, I see it on Facebook posts all the time.
    I like it, instead of a “meat and potatoes” approach, it’s a “meat-balls” approach. :-)

  • Jeffkan1

    Good article Jo, thanks.

    I have to call bullshit on the “Despite the fact that even full-size, 4WD luxo-barge SUVs are getting better than 25 MPG these days,” Reading the article, you said a 2015 Chevy Tahoe for you got just under 24 mpg. How much does a 2015 Chevy Tahoe cost… $61k? And because it’s a luxo-barge SUV, are we supposed to be satisfied with getting just under 24 mpg… because it’s the best an SUV has ever done?

    I dunno, different vehicles serve different purposes to different people. No one vehicle is everything to a particular person. Universally, a person has to “accept” certain difficiencies in the vehicle that we buy. A Cadillac sedan won’t haul a 12-foot ladder… a Chevy Tahoe is way WAY expensive… a Nissan Leaf doesn’t go very far if you are not in a metro area with charging stations… etc.
    But hey, if a person likes to sit up high, and have A/C in the seats, and feel good about getting less than 24 mpg in a 2015 vehicle, and “win” any sort of collision with most any vehicle, and instantly be upside-down on the value when you drive it home for the first time, then the Chevy Tahoe is it.

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