Ommm – ummmm
The first thing they drummed into me when I started as a copywriter for Volkswagen: “Never use superlatives. They only get you in trouble.” Now, Elon Musk is in trouble over who was first to fully pay back the government loan.
Yesterday, Tesla wired $452 million to repay the remaining portion of its DOE loan with interest. The company told Reuters it is “the only American car company to have fully repaid the government.”
Chrysler fired back four hours later: “Not exactly, Tesla.”
Having repaid $7.6 billion in federal loans in 2011, Chrysler said today : “Tesla’s information is unmistakably incorrect.”
Musk went on Twitter and came back with a retort that will enrage red, white and blueblooded Chrysler fans. He said Chrysler is no U.S. car company, it is a division of Fiat and besides, Chrysler never fully repaid its loans.
Says Reuters: “The U.S. government recouped about $11.2 billion of its funds. In 2011, Treasury said it is unlikely to fully recover $1.3 billion owed by Old Chrysler.”
All I can say: Stay away from superlatives. They only get you in trouble.
Chrysler paid back most of the money they borrowed, that was the agreement, leaving the goverment in the red.
Tesla paid back all the money they owed, with interest, and left the government in the black with a small profit.
Plus, the Chrysler and GM bailouts fucked over senior bondholders in favor of union-held subordinated debt. I think Chrysler needs to STFU.
Well, technically Chrysler repaid a bunch of government backed loans back during the Iococca bailout in the 80’s when they were still American so I suppose technically that Chrysler was the first American company to pay back Uncle Sam, though I don’t think any of that money actually came from the treasury but rather private banks with Uncle Sam as the cosigner.
Reuters has it right. Sergio and Elon are both off slightly in their details. Mr. Musk is just trying to boost TSLA a little higher.
All this is not important. I am tracking how my friend’s Model S is doing, now that’s a real car that he drives around and it establishes if Tesla can make cars. As for the PR, Elon and his minions sometimes cause flaps like that. I do not remember if Elon Musk himself or Diane Murphy said it, but someone initially said that Falcon 1 was the first commercial rocket to reach orbit. Almost immediately they corrected themselves, and without ever admitting or even mentioning Pegasus, renamed it into “the first liquid-fueled commercial rocket to reach orbit”. There was also a flap with calling FH the second most powerful rocket after Saturn V, forgetting Energiya.
Looks like Elon needs to turn down the air conditioning.
And I think Chrysler is a subsidiary of Fiat, not a division.
AND didn’t Chrysler fully pay back government loans in 1983?
Chrysler is an American corporation incorporated in Delaware with Fiat being the majority stockholder.
Kudos to Tesla and Chrysler.
Foreign-registered vs. foreign-owned a distinction without a difference.
There’s a major difference.
If Chinese investors bought up a majority of Tesla’s stock tomorrow, would Elon cede that Tesla is no longer a U.S. company?
Doubtful. The world is whatever Elon tweets it is, apparently.
Until the hypothetical big foreign owner decides to fire him…
And that’s what a majority stockholder can do, regardless of where they’re from.
Foreign owned == foreign controlled. It’s not as bad as that, though, since everyone’s interests are largely aligned toward selling cars. Really, both Fiat/Chrysler and Ford are starting to behave like global companies, but for different reasons.
They were government backed if I remember. So if Chrysler didn’t pay them the treasury was on the hook but I believe the money came from private banks and so the paybacks actually went back to those banks. A valid point though.
Also, the Tesla money is the DOE advanced technology loan which several automakers took (Ford, maybe Nissan if I remember) Correct? The Chrysler money was under TARP or part of that legislation wasn’t it? I know the TARP stuff has in the eyes of the public become a bailout which carries a lot of negative stigma. This is the same money Ford got which the public doesn’t seem to mind.
As an electric startup though, I can see the value of creating the perception your product can stand on its own. The next step would be a successful product without the tax rebates IMHO. If they can get there then they have made it. I continue to root for them.
Only ‘government backed’ not ‘government loans’ back in the 80s.
I thought his context was implying with respect to the DOE loans, which is quite correct. But if he’s talking ever, he’s still correct since Old Chrysler’s $1.3 billion is conspicuously missing.
Quem fala demais da bom dia a cavalo.
Right. What he said.
didn’t get it? I just said, ‘he who speaks too much says good morning to horses.’
“speaking of other good day riding”…?
almost! See above.
All my wife’s Polish folk adages rhyme in Polish. I don’t speak no Portugee, only a little Mexican, and I can’t even properly sound out your missive. Does it rhyme or scan? Not that it really matters.
Old local saying in these parts was that (frontier) Texas was heaven for men and dogs, but hell for women and horses. Horses were a good thing to own, but they were serious polluters in several ways all emitting from their exhaust pipe. Nobody wanted to sleep anywhere near them.
You mean Spanish instead of Mexican, although every latin-spanish speaking country has its “own language”, or variation of Spanish. The worst offenders are the Argentinians and the Spaniards themselves.
It always cracks me up when you northamericans say mexican instead of spanish.
“It always cracks me up when you northamericans say mexican instead of spanish.”
What’s the difference?
Oh, yeah… Spain’s unemployment rate is 5X higher.
There’s a difference between Mexican and Spanish. My wife, a Portuguese who lived in Madrid for awhile, speaks fluent Spanish, she frequently can’t understand Mexicans when they talk.
I had the same experience with English in Texas.
I have two half Mexican grandchildren who are hell on wheels. My Anglo ancestors have lived in the borderland of Tejas since the 1830’s My great-great grandfather bought his original piece of land from a Mexican named Cherino.
My words are fully considered, pendejo. Mexican to me means Spanish as spoken by Mexicans. You want a really tough language? Try Spanglish.
Tesla’s statement was clearly in the context of the DOE ATVM program. In contrast, Chrysler (and GM) got government bailout loans as part of TARP. This should not to be confused with the ATVM program which was about promoting “alternative technology”.
There have been only five recipients of the ATVM loan. These are Ford – $5.9B, Nissan – $1.4B, Tesla – $465M, Fisker – $192M out of $529M, and a small company called Vehicle Production Group (VPG) – $50M. Fisker and VPG are failing and looking to be acquired. Tesla repaid their loan. Nissan and Ford are still making payments on schedule.
Chrysler should shut up until the senior debtholders who got screwed in the bailout get paid back at par plus interest.
I have never understood the details of the Chrysler bankruptcy. Traditionally, labor’s claims for unpaid wages have ranked close to the top amongst those who have a claim. Pension funds and other future claims of labor, maybe not so much.
In bankruptcy, equity (ie. shareholders) take the first hit to the point of getting wiped out. This did happen with Chrysler. Lenders who don’t have a specific lien on property are next in line to get wiped out. That would be you. Was there something wrong or unfair with the Chrysler situation?
From the reports that I’ve seen, the Bond holders (people who hold paper IOUs for future repayment) took a loss, while the Union pensions (people who have a contracted promise of future payments) were made nearer to whole.
This stands a couple centuries of bankruptcy law (dating back to pre-America days) on its head.
While Union labor should be first in line for wages unpaid, there weren’t any unpaid (back) wages when the deal went thru. Next in line are bond holders and creditors (secured liabilities). Once those who have already put money into the company get paid back (either from liquidation of assets, or some other settlement), unsecured liabilities (contracted payments for work not yet done, or benefits not yet realized) get a swing at whatever is left.
In GM and Chrysler’s case, the contracted pension funds got paid first, and the bond holders got the shaft.
If you declared bankruptcy tomorrow, based on the GM/Chrysler formula, your house and cars would be sold, your credit cards and doctor’s bills would get paid off first, your car loan and second mortgage would fight for second place, and your mortgage company would get the scraps.
…and, to be more accurate, you’d get to keep the house, but the neighbor that you promised to invite over to dinner sometime would move into your spare bedroom.
MAN BOOBS!!!
Good advice Bertel. If Musk simply paid more attention to what he said he would have fewer fires to put out and probably would need less Prilosec at the end of the day.
But he generates tons of free PR. Good for business.
Chrysler paid back what they were legally obligated to first. And yes, as already pointed out, they are a registered U.S. corporation. They are not a division of Fiat, Fiat is a majority stockholder.
Musk is really making himself out to be a blaggard by trying to boost his own company’s reputation by spouting off falsehoods.
“And yes, as already pointed out, they are a registered U.S. corporation.”
Kind of like TOYOTA MOTOR SALES, U.S.A., INC, California registration number C0346014.
Yes, kind of.
DItto for Honda of America. I guess we should call them American too?
Perhaps. Why do you people seem to think this is some sort of revelation?
There are some differences between Chrysler and Toyonda of America. Where the global headquarters of their parent corporations are, where the R&D activites are centered and where most of the profits end up, if any of that even matters to you at all.
Chrysler is registered as a U.S. corporation with it’s headquarters in Auburn Hills, Michigan. The profits go there. When/if a full Fiat merger takes place, sources indicate that Fiat will move it’s global headquarters to Auburn Hills, not the other way around.
Then by the definition of some, will Fiat become an American company? Semantics.
Tesla’s over $1B (currently, not counting unfunded liabilities) in the hole to investors.
Profitable so that investors get paid back with a return? Never in a bazillion years. Just like GM-Episode II…