Archive for the ‘General’ Category

 

Jun 11

US plug-in car sales expected to be 1 million by 2024

 

Is this a fitting follow-up story to yesterday’s news?

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By Sarah Shelton

A market research company is predicting that the U.S. will reach about 1 million sales of plug-in electrified vehicles each year in the next decade.

Navigant Research recently released a forecast covering market trends for plug-in electric vehicles (PEVs). Both conservative and aggressive estimates were reported, with sales of plug-in hybrid and battery electric vehicle categories combined for the analysis. Looking at the U.S. and Canada, the firm divided the data by region, creating a snapshot of states, provinces and metropolitan areas.

Local incentives and fuel costs were named as the primary variables for the researcher’s predications, suggesting a direct link between these and PEV sales.

U.S. Sales Forecast

According to Navigant Research, more than 133,000 PEVs were sold in North America last year. In the U.S., a breakdown of 2014 sales corresponds to 55,357 plug-in hybrid and 63,325 battery electric vehicle sales.

Over the next decade these sales will continue to grow throughout the U.S. The forecast predicts a compound annual growth rate (CAGR) as high as 20.9 percent, with moderate estimates closer to 16 percent.

“Overall, the United States is expected to be the largest market throughout the forecast period, with PEV sales in 2024 exceeding 860,000 in the conservative scenario and 1.2 million in the aggressive,” said Navigant Research.

Dissecting the sales by region, the researchers noted that a third of all PEVs will be sold in California in 2024. This comparatively high proportion, which mirrors the state’s current share of nationwide PEV sales, mostly stems from the state’s stringent zero emission vehicle (ZEV) standards.

About 3 percent of light duty vehicles currently sold in California are PEVs; Navigant Research estimated that in the next decade this will increase to between 15 and 22 percent.

Sales of PEVs in the nine other states that follow California’s emission standards – Connecticut, Maine, Maryland, Massachusetts, New Jersey, New York, Oregon, Rhode Island, and Vermont – will constitute another third of the transactions, marking a significant increase in sales for these regions. The remaining states will make up the rest of annual PEV sales.

“Outside of the ZEV states, PEV sales will grow most quickly in states with large vehicle markets, high PEV incentives, well-developed infrastructure, and a high PEV index,” said Navigant Research. “Hawaii, Washington, and Georgia are the only other states besides the 10 ZEV states expected to have penetration rates comparable to ZEV states at over 7 percent in 2024.”

SEE ALSO: This Month America Will Be 30-Percent of the Way To Obama’s 1-Million Plug-in Goal

Canada Sales Forecast

There are far fewer PEV sales in Canada than in the U.S. reason, partly because it takes about a year longer for plug-in electric models to reach Canada.

As the country begins catching up, the researchers predicted sales will increase faster than for the U.S. at rates between 22.8 and 25.7 percent. By 2024, sales within Canada could reach as much as 91,000 PEVs per year.

SEE ALSO: European Plug-in Sales Leap Ahead of US For The First Time

Other Considerations

Navigant Research also analyzed where PEVs will affect utility companies. Just as California is set to experience the largest growth of PEV sales, the researchers also expect that the state’s utility companies will receive the greatest impacts, with large numbers of drivers plugging in to recharge their vehicles.

Specifically, these issues will affect metropolitan areas of California the most, including Los Angeles, San Francisco and San Jose.

“Utilities serving these areas have been at the forefront of developing advanced demand-side management programs for residential PEV charging and vehicle-grid integration,” the researchers said.

“Utilities and regulatory authorities in emerging PEV markets elsewhere in the United States and Canada will likely follow suit, creating new opportunities for energy aggregators and EVSE service providers.”

This article originally appeared at hybridcars.com

 

Jun 10

Plug-in sales in Europe eclipse those of US for first time – and by 60 percent

 

It’s a different market over there.

Will the U.S. regain its lead or will the gap widen even further this year?

Does this also show opportunities exist in the U.S., including with electrified trucks, SUVs, crossovers, and other popular vehicles?

Mitsubishi Outlander PHEV

Bolstered by availability of a car model the U.S. does not get, Western Europe’s plug-in-electrified vehicle (PEV) sales are solidly eclipsing those of the U.S. for the first time.

Sales volume in the new global leader for the period of January through April 2015 is actually 60-percent ahead of the U.S. which held a lead through 2014 and then fell behind at the turn of this year.

Too many factors to fully contemplate are responsible for the trading of places, but one notable fact is Europe is experiencing a much-closer split between acceptance of plug-in hybrids versus pure battery electric cars, and PHEVs are on the rise.

According to Europe’s Automotive Industry Data newsletter, Western Europe purchased 51,386 PEVS through April. These are comprised of 24,578 plug-in hybrid electric vehicles (PHEVs), and 26,808 battery electric vehicles (EVs).

By contrast, the United States bought 32,087 PEVs through April. These consist of 10,684 PHEVs and 21,403 EVs – double the EV sales in a market with more EVs and during a relatively weak time for PHEVs including the Chevy Volt.

The global PEV market is yet tiny, but Europe has witnessed faster year over year increases and the split between PHEVs and EVs has gas-electric PHEVs catching up and predicted to supercede EVs, whereas in the U.S. consumers are preferring more EVs.

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This is a shift in buying decisions for the U.S., and one year ago during the same January to April timeframe in 2014, the U.S. was split nearly evenly with 15,967 PHEVs and 15,060 EVs.

While comparing a continent to a nation may be arguable, the European Union is in respects categorized as a sole entity, and in any case, Western Europe is a more or less cohesive sales region.

Its acceptance rate of plug-in cars also surpasses China’s reported numbers although that nation said to be full of potential has been on a tear to subsidize and increase its PEV sales.

ChinaAutoWeb reports a 27,405 China-made plug-in hybrids, a 166 percent increase over the same period one year prior, and pure electric cars are at 16,138, a 132 percent increase.

SEE ALSO: Top 6 Plug-In Vehicle Adopting Countries – 2014

Sales in an early leader and producer in the PEV market, Japan, are meanwhile down significantly in 2015, hovering at around 8,000.

This leaves Western Europe as the global leader in PEV sales at the moment, and its pace has been increasing.

Calendar year 2014 sales had the EU at 97,791 and the U.S. at 118,682.

Last year the U.S. was the global leader, but it lost its lead beginning this year.

EU Plug-in Hybrid Growth

A look at the breakout of plug-in hybrid and battery electric vehicles indicates plug-in hybrids are gaining ground comparatively faster in Western Europe than in the U.S.

As observed by the industry AID newsletter reporting from closer to the EU market, the PHEV and EV segments are vying neck and neck, and one vehicle is heavily credited for this – the Mitsubishi Outlander PHEV which has also become the number-one PEV in the UK.

If you follow plug-in cars, you already know the Mitsubishi Outlander PHEV is an SUV Americans have been asking for since 2013 when it was launched in the Netherlands.

Think of it as the nearest thing to a Chevy Volt in five-passenger, all-wheel-drive form. Its electric range is in the 20-some miles span, and reports have been it can be squeaked to over 30 in easier driving, and it’s a light truck.

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A heavily modified Outlander PHEV completed the FIA-certified Asia Cross Country Rally 2014. According to the AID newsletter, a couple of the strongest drivers in Western Europe are the Netherlands and UK which account for two out of three PHEV sales.

Americans love trucks, and apparently the vehicle is working for Europeans too. Global sales for the Mitsu are over 60,000 and this is without its being imported to the U.S. It’s been repeatedly delayed and has gone through a model cycle and the U.S. is being promised the refreshed one next year.

“Kicked off in a near solo-move in the Netherlands during October 2013, followed nearly a year later by its no less spectacular showroom debut I the UK,” says the AID newsletter, “almost overnight Mitsubishi’s Outlander PHEV has spawned – if not pioneered – and almost entirely new sub-sector.”

Beyond this, European automakers driven by regulations demanding lower CO2 output, and increasing popularity for plug-in hybrids besides, are bringing more models into their portfolio.

SEE ALSO: Revised Mitsubishi Outlander Coming For 2016

Projections for the “neck-and-neck” race between two different approaches are for PHEVs to possibly surpass EVs though AID’s industry forecast is not bullish for high-end PHEVs created by German automakers targeting the affluent.

Rather, cars like the Outlander PHEV and any others that can be had by more people on a more-modest budget are predicted to support higher sales volume.

Both PHEVs and EVs have their pros and cons, of course. For pure EVs, they are zero emission, and the electric drive experience favored by many is not marred by part-time (or most of the time) gas engine operation in a hybrid mode.

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For PHEVs, there is no range anxiety. As it is, this latter form is catching up, while in the U.S., products such as they are have shown EVs the overwhelming favorite.

While an in-depth analysis is beyond the scope of this article, in brief, one factor to be mindful of is the specific models available in Europe are in cases overlapping – like the Nissan Leaf and Tesla Model S – and in cases different.

In addition to the Outlander PHEV, Europe gets Renault, Citroen, Peugeot PEVs the U.S. does not including the relatively popular Renault Zoe. The U.S. gets the Chevy Volt but then again, so did Europe as the Opel/Vauxhall Ampera and Chevy branded, but GM could not sell that car there and it’s not due to come back with generation two.

The global best-selling car is the Nissan Leaf which just crossed 175,000 sales. It alone is responsible for over 20 percent of cumulative global PEV sales which now are in the vicinity of 850,000.

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Beyond this, a host of variables other than product selection come into play including buyer attitudes, and incentives. Europeans are enjoying relatively lower gas prices, though they are higher than in the U.S. Europeans are also less divided over the climate change issue. In the U.S. there is a strong debate in some quarters and much outright animosity levied against the notion that greenhouse gases could be altering the global climate.

Meanwhile, Europe is now ahead and gaining ground. How things will play out the rest of the year with the launch of the Volt in the U.S. and Leaf sales tapering off plus many other factors is anyone’s guess.

Thanks to Mario R. Duran for his assistance with the data.

This article originally appeared at hybridcars.com

 

Jun 09

Bob Lutz “just doesn’t see it” with Tesla’s Powerwall

 

Bob Lutz has called it correctly before. Do you think he has a point, or is his intuition letting him down?

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If you’re holding onto Tesla stock but are not quite sure if you should, a quick talk with Bob Lutz could push you over the edge to sell.

At least one might surmise as much after listening to the “Father of the Chevy Volt” who’s also involved with VIA Motors plug-in hybrids lay out a case for why TSLA may be topped out.

Since the California carmaker announced it was now a California energy storage business with its li-ion Powerwall units for home and industry, TSLA has gone up 25 percent over what some say is already an inflated price, but Lutz in a video clip is decidedly bearish.

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Saying he has admiration for Tesla head Elon Musk, Lutz said he does not see the business case for lightweight and compact li-ion energy storage when lead acid is cheaper and will do the job.

SEE ALSO: Will Tesla Powerwall Fail To Live Up To Expectations?

“I think [the battery] is greatly overvalued because having batteries as backup storage has been around for hundreds of years,” Lutz said in an interview on CNBC’s ” Squawk Box.” “I can’t understand the fascination with this.”

He also says Tesla’s core car business is yet “infinitely small,” and the hype may be overblown.

“The company is also hemorrhaging cash,” he said. “I’m not recommending ‘sell’ because I’m not an analyst, but if I was a holder, I would think that this is the top the stock’s going to [reach].”

Lutz’s comments came in advance of Musk’s speaking at the Edison Electric Institute convention in New Orleans.

Yahoo

This article originally appeared at hybridcars.com

 

Jun 08

Tesla mobile stores bypass dealer franchise laws

 

What do you think of Tesla’s “secret weapon?”

By Sarah Shelton

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Never one to pause in the shadows for long, Tesla Motors is again showing its unconventional side with its new “mobile experience.”

Made from shipping containers, Tesla said that it’s planning to tour this new mobile store around the country.

“Designed in-house, the shipping container arrives and unfolds to double its size in just a few hours,” Tesla said in a media release.

“The mobility and convenience of the design allows Tesla to bring our unique retail approach to customers in new locations where we do not yet have a brick-and-mortar location.”

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Obvious benefits with this setup include a reduction in costs normally tied to a permanent location, as well as the opportunity to reach out to new consumers in a unique way.

But this pop-up store also allows Tesla the ability to bypass the headaches of applying for a business license or gaining the approval of local officials. The electric carmaker doesn’t use franchised dealers to sell its vehicles, opting instead to sell directly to customers. In some areas, though, legislation has blocked this factory-direct sales method.

With these mobile stores, Tesla can circumvent laws that prevent it from opening a brick-and-mortar store. Though it may not be able to quote prices in states like Michigan or Texas, company representatives can still educate buyers, who can then purchase the car online or through another state.

SEE ALSO: Elon Musk Biography Offers Insight Into Tesla’s CEO

When CEO Elon Musk first hinted about these pop-up stores a few months ago, he said the strategy could be a “good weapon against the dealers.”

Tesla has “a secret weapon on the demand side that we’ll probably start to deploy later this year for demand generation,” said Musk during a Tesla earnings call.

Those in the Santa Barbara, California, area can visit Tesla’s only U.S.-based mobile store through the end of June. From there, the container will travel across the country to the Hamptons.

The carmaker has three pop-up stores traveling through Europe as well, which are set up at the moment in France, Switzerland and Denmark.

 

The Motley Fool

 

Jun 05

The Chevy Bolt: What We Know

 

I wish I had more to tell you, but then that’s what Chevrolet said to me when its rep replied to a bunch of questions saying she could not comment yet.

This vehicle has had a few rumors morph to almost established as (imagined) fact in peoples’ minds, so it’s caveat emptor for the information consumer. (In some circles, but this article cuts a wide berth between what is known and only conjectured.)

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Just the idea of a 200-mile-range, mid-$30,000 electric car hoped to be on sale in another 18 months has made the Chevy Bolt disruptive before it even gets here.

First-generation EVs priced in the same vicinity with 76-93 miles EPA-rated range do boast happy customers, but many people are perched on fences, waiting for something like the Bolt to materialize into reality.

The second-generation EV from Chevrolet is expected ahead of a similarly spec’d Tesla Model 3 and Nissan’s next Leaf. What little GM has said about the Bolt is enough to put some buying decisions on hold, make Nissan’s CEO divulge ahead of his PR staff that the Leaf won’t be left behind, and pressure Tesla too.

The four-passenger EV concept since approved for production was introduced in Detroit this January alongside the 2016 Chevy Volt and seemingly out of left field, but we should have known it was coming.

SEE ALSO: GM CEO Akerson Assigns Team To Keep Tabs On Tesla

After all, Elon Musk did, and its conceptualization was reported in September 2013 as Musk applauded former CEO Dan Akerson who while saying he wasn’t sure a 200-mile EV would cure range anxiety, Chevrolet would build one.

“Am happy to hear that GM plans to develop an affordable 200-mile range electric car. Right target. Hope others do same,” tweeted Musk.

From Down Under

The Bolt concept was a joint effort between GM Australia, GM Korea and GM North America.

Actual construction was at GM Australia’s Port Melbourne-based design studio.

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GM’s Aussie location was one of only two GM design workshops in the world said to be capable of doing the job and what it turned out bears not a little similarity to the BMW i3, but is to cost $5,000 less and offer 2.5 times the range.

“The Bolt EV concept is a game-changing electric vehicle designed for attainability, not exclusivity,” said General Motors CEO Mary Barra. “Chevrolet believes electrification is a pillar of future transportation and needs to be affordable for a wider segment of customers.”

Powertrain?

General Motors has said almost nothing definitive on actual powertrain hardware.

GM says only that it will leverage lessons learned from the Volt and Spark EV for the Bolt intended as a global EV sold in 50 U.S. states.

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But just because GM is playing its hand close to its vest doesn’t mean intrepid EV sleuths have not been working overtime speculating.

Anything is possible, but some of the believed-reasonable guesses include that GM will find a new use for the underworked Spark EV motor with single-speed coaxial gear box and adapt it to the Bolt.

The Bolt’s battery of unspecified kilowatt-hour capacity is believed to be coming from LG Chem, and may be a newer generation chemistry though this isn’t confirmed.

GM has hinted the Spark EV’s motor was meant from the start for more applications, and a truck-like 400 pounds-feet of torque in the subcompact is an unsubtle hint.

Given cars like the Model 3 will be out there, the Bolt needs to live up to its debatable name that rhymes with Volt and the Spark’s motor or one based on it with around 200 horsepower (150 kw) ought to be suitable for respectable 0-60 and 0-30 times.

The Spark EV is good for around 7.2 seconds to 60, and is really zippy to 30 with “instant torque” so the Bolt may also bolt in qualified terms.

One educated guess comes from Silicon Valley software developer Jeff Nisewanger who co-wrote for us what may be the best deep dive into the 2016 Volt’s drive unit and who likes to look up arcane patents and read engineering papers for fun.

Curb weight might be in the realm of 3,700-4,000 pounds he hypothesized. A Nissan Leaf with 24-kwh pack comes in at 3,300 pounds including a 600-pound battery. To do an honest-to-goodness 200 miles EPA-rated range, the Bolt may need 55-60 kwh and that pack could weigh 1,000-1,200 pounds, so do the math.

Is This The Bolt’s Battery Patent?

By Jeff Nisewanger

Companies frequently file patents that they never commercialize but a patent last year was just issued to LG Chem and smells like it could be the basis for the new “200-mile” battery cells that will be used in the Bolt. Or maybe not. But it sure sounds promising.

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LG Chem patent record.

Basically, LG Chem says it’s figured how to solve problems that Argonne National Labs and failed GM-supported battery startup Envia had with their “layered-layered” lithium-ion NMC cell chemistry.

At issue is the higher the voltage used to charge a battery, the more energy it can store. Today’s NMC cells like the ones used in the first and presumably second-generation Volt can be safely charged to about 4.15 volts – although the Volt uses a somewhat narrower range in order to further improve battery life. Charging higher than that makes the cathode chemistry unstable and leads to poor cycling life.

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The new patent claims to allow stable high cycle life with charging up to 4.4 volts. So, a charged battery usage range of 2.5 – 4.4 versus 2.5 – 4.15 volts (voltage goes down as the battery’s usable energy is discharged). It’s unclear how much energy density this adds to these new cells but it seems likely to be 10-20 percent. That’s good incremental progress.

If they don’t use this patent there were several others filed and recently issued to LG Chem that claim to provide similar improvements in energy capacity.

It’s also possible that they could be improving the anode side of the battery by adding some silicon, etc., to further increase overall energy density but that topic isn’t addressed by this patent.

Whether this patent is really used in a Bolt rushed to market is open to question, and GM has not confirmed it will be. It’s actually a bit of a stretch to think it might be applied in automotive products as soon as 2017 but GM is desperate for better batteries and we know from the Envia experience that it is willing to be aggressive about putting new battery designs into production vehicles.

 

Because the car will be heavier, more weight will require a stronger vehicle structure meaning bigger wheels, tires, heavier suspension, and more driving up the weight.

But, GM may use some weight-loss tricks learned with higher strength steel, aluminum, and various other materials such as were used in the Cadillac CT6.

To make this a more versatile EV, quick charging will be desirable. The 82-mile rated Spark EV charges at a lower maximum DC charge rate of 30-50 kilowatts and the Bolt could benefit from quicker capability. Tesla equips its Supercharger-enabled cars with up to 135-kw capability, and larger battery kwh sizes are capable of higher charging rates and need them to make long distance charging reasonable.

Nisewanger postulates the Bolt battery will have a max charging rate of around 80 kilowatts, but this like other conjecture remains to be proven.

Functional

The automotive term in vogue for the Bolt’s body style is “crossover” but you might also just as well say the Bolt will be a hatchback, a box on wheels stylized to look trendy, and with coolness baked in given this EV will be atop its game.

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Lots of interior room is gained with very little front and rear overhang a la BMW i3, and gone is any prospect of a giant bulky battery or T-Shape like the Volt has intruding into interior space.

Rather, the Bolt’s battery is to be a flat below-floor design such as other purpose-built EVs employ meaning no middle hump and flexibility for designers to make this a comfortable car possibly even with a three-across rear seat. Although five passengers is not officially verified, GM VP Mark Reuss did mention in a video to reporters in January the flat battery allows “five passengers and utility” space, which the automaker has otherwise pointed out.

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“Form and function have never meshed so well together,” said Ed Welburn, vice president, GM Global Design. “No compromises were made when it came to aesthetics and the elements that contribute to the Bolt EV concept’s range, resulting in a unique proportion that’s sleek, efficient and obviously a Chevrolet.”

Unknown for the production Bolt is what specific materials will be used. The concept employs lightweight aluminum, magnesium, carbon fiber and woven mesh. The futuristic and airy design exercise also has impractical elements like pedestal seats that almost certainly won’t make it to production.

What may make it to production is the latest suite of connected infotainment accessible via smartphone – including for things like setting and monitoring charging and pre-warming remotely.

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We expect some of the swanky design elements will be toned down, but Chevrolet will do its level best at making the car seem as upscale as possible.

Functionally, the vehicle will likely be well contented for a Chevy like the Volt is as GM is discovering higher socionomic strata are attracted to its plug-in cars.

Due When?

Reported insider claims have set it in the public minds’ eye that the production date is to start October or November 2016 and the Bolt will be a 2017 model year car.

We have heard it from people who should know better this is a date certain projection from the lips of GM, but actually it is not.

SEE ALSO: Is Tesla’s Model 3 Affecting Us As Profoundly As Did Ford’s Model T?

When we asked Chevrolet communications rep Annalisa Esposito Bluhm last week whether we’d missed a press announcement or this was rumor being passed off as fact, her answer was the latter.

“Rumor being passed as fact,” she said. “We have not yet publicly confirmed Bolt EV timing or the model year. Stay tuned.”

GM may come along and confirm everyone’s suspicions but like many details it’s holding out for now.

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Even the name – Bolt – was at first unsettled and then contested. GM has twice had its trademark application suspended and had to negotiate with Yamaha and contend with the fact that another company wanted the name “Bolt” for a product.

The name is back on track. Some like it, some don’t, some don’t care.

Most importantly is the Bolt is pending and already threatens to sap customers from the Volt which is like a gateway drug to pure EVs and the Bolt with decreased “range anxiety” could be the fix they’ve been waiting for.

It also raises the bar for EVs and threatens to send other automakers back to their CAD-CAM programs.

While newly launched 80-90-mile EVs from Kia, Fiat, Volkswagen, Mercedes-Benz, BMW, and others are just gaining traction, they could look like yesterday’s goods as soon as next year when the Bolt EV doubles the range for the same price or less.

 

Jun 04

Musk-Controlled Companies Received $4.9 Billion In Subsidies Says LA Times

 

Is this fair? Was it a slam attack? It’s not the first time but was done in Tesla’s backyard.

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By Sarah Shelton

Government support for Elon Musk’s three companies – Tesla Motors, SolarCity and SpaceX – has reached $4.9 billion, according to a recent report by the Los Angeles Times.

Reactions to the story have been strong, both from Musk and from readers. The Los Angeles Times has received more than 530 comments, some from supporters of Tesla and SpaceX, and some that oppose the government’s involvement.

The news story comes on the heels of a recent report by the International Monetary Fund, which calculated that oil and gas subsidies worldwide total $5.3 trillion each year. That’s the equivalent of $10 million spent every minute.

$4.9 Billion In Government Support For Three Companies

Slate magazine recently remarked that Musk’s main goal in life was, “and I’m not exaggerating here – to develop the technologies he deemed most crucial to the future of humanity.”

But the Times suggested that a very different set of ambitions may be leading Musk’s direction. Last Saturday, the newspaper made waves with its report that three companies Musk is involved in have garnered a total of $4.9 billion in government subsidies.

“He definitely goes where there is government money,” said Dan Dolev, a senior vice president and financial analyst at Jefferies Equity Research, in the Times’ article. “That’s a great strategy, but the government will cut you off one day.”

The financial support comes as a mix of tax incentives, grants, property tax exemptions and rebates. According to the Times, the current totals break down like this:

Tesla Motors: $2.391 billion

SolarCity: $2.516 billion

Space Exploration Technologies (SpaceX): $20 million

“The figure underscores a common theme running through his emerging empire: a public-private financing model underpinning long-shot start-ups,” said the Times.

SEE ALSO: How Do Electric Vehicle Incentives Compare To Oil And Gas Subsidies?

Ashlee Vance, author of a biography on Musk, noted that states even compete with one another, offering government support to persuade Tesla and SolarCity to build factories within their borders.

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But, asked the Times, what reward is the public seeing from all this funding?

“A looming question is whether the companies are moving toward self-sufficiency – as Dolev believes – and whether they can slash development costs before the public largesse ends,” the Times said.

“Musk and his companies’ investors enjoy most of the financial upside of the government support, while taxpayers shoulder the cost.”

The Times also observed that much of the funding has come from private sources, saying that Musk himself used much of his earnings from the sale of PayPal (which he helped found) to fund these projects.

“But,” said the Times, “public subsidies for Musk’s companies stand out both for the amount, relative to the size of the companies, and for their dependence on them.”

While it’s prudent to maintain a level of caution with government spending – especially after automotive companies like Fisker folded after receiving a $192 million loan from the U.S. government – it’s also beneficial to remember the potential gains of such investments.

SEE ALSO: Elon Musk Biography Offers Insight Into Tesla’s CEO

For example, also listed in the Times’ accounting is $517.2 million that Tesla has earned by selling carbon credits to other automakers. But the news site doesn’t explain that other corporations rely on buying these credits to reduce their overall carbon footprint. Chevrolet currently leads this trend; the $40 million it will have spent by the end of this year is far higher than any other automaker.

The Times said that there is no guarantee the country will benefit from this publically funded support.

“The payoff for the public would come in the form of major pollution reductions, but only if solar panels and electric cars break through as viable mass-market products. For now, both remain niche products for mostly well-heeled customers,” the Times wrote.

Readers React

After the Los Angeles Times article was released last Saturday, the news site received an onslaught of reactions from readers. As of our press time, more than 530 comments had been entered online, with the number still growing. Others had been submitted via email.

Some viewpoints noted that the government spending is an investment that benefits the greater good:

“It’s worth noting that Tesla has made all of their patents open-source, which isn’t trivial,” said one comment, which was selected as the editor’s top pick by the Times. “On the other hand, it is my strong opinion that the government should subsidize research, development, and deployment of new technologies. I’d much rather have my tax dollars go to solar panels, electric cars, and passenger space travel than Big Oil and Agribusiness.”

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“I would like to see the author calculate the tax money saved by Spacex,” was another comment. “The missions to the [International Space Station] have saved NASA, read tax money, hundreds of millions, per flight that is. Money that would have gone to Russia for the most part. Solar City is decreasing America’s dependence on oil, gas, coal and nuclear one roof top at a time … So many American and other lives were lost defending the oil supply needed to keep oil prices ‘low.’ Why does investing in American jobs to prevent the loss of life suddenly become a bad thing?”

Others felt the subsidies are unnecessary interventions from the government:

“Farmers, fossil fuel producers, and PBS get tax subsidies. They shouldn’t but they do,” one reader said.

“The various government agencies that are paying for Elon Musk’s empire should be getting stock in return for their investment,” wrote another reader. “When Chrysler needed a government bailout in the ’80s, the government received stock warrants that the treasury department was later able to cash in to recoup their investment. If Musk had gone to venture capitalists to get his funding, he would have had to give them a percentage of the company. Under the present arrangement, Musk gets to keep $10 billion worth of stock all to himself, and the taxpaying public who finance him gets nothing.”

Elon Musk Responds

In an interview yesterday with CNBC, Musk disputed much of the Los Angeles Times article, saying it was inaccurate and misleading.

Similarly to his response to the New York Times’ writer John Broder’s account of running a Model S out of juice in 2013, it seemed this report from a prominent publication particularly irked him enough to strike a personal nerve.

“[I]f [Hirsch] was paid by an oil and gas industry lobby, he couldn’t have written a more favorable article for them,” said Musk.

“The article makes it seem as though my company is getting some huge check, which is fundamentally false,” he said.

“None of the incentives are necessary, but they are all helpful,” Musk said, adding, “The incentives that Tesla and SolarCity receive are a tiny, tiny, pittance compared to what the oil and gas industry receives every year.”

 

Photo by Lambert/ullstein bild via Getty Images)

Hat tip to Noel.