Published on August 16th, 2014 | by Jo Borrás
Elio Motors Has a Town Hall Meeting, I Go To It
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 …
… 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.
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.