Agreed, except for the "expensive" part. Elio was claiming that they could do all the expensive stuff and still be half or less the price of the competition. Or are you implying that Elio knew all along that they would be unable to include all of the expensive safety equipment at the proposed MSRP?
You have to remember. All of the three wheelers I mentioned are low volume and sold to people that just want a fun vehicle to go out on the weekend with or they live in some urban area and they use it for doing short trips. It's a limited niche vehicle, thus they don't need all of the safety items because those people will buy them no matter what. They are willing to take the risk when a F150 pulls out in front of them, they hit the binders and slam into the LF wheel. The chance of surviving that if you are at 35 mph is much lower than if you were in a Civic. The alternate is you jerk the wheel to avoid it and your FUV or Solo goes on it's side. Both scenarios are real world and no matter if you have the talent on par with every top notch NASCAR driver, you can't avoid the idiots.
What Elio had to do was include these safety systems because if they did not, they would be in the same niche situation. This is because three wheelers are a hard sell to begin with to the masses, thus Elio recognized this and had to make it as safe as that Civic. With that, they appeal to a broader audience and that's where the large volume come. I hear quite often that somewhere Paul told everyone that they were going to make $1K per car and 20% on the options. If he did say that then either he left out or everyone just cherry picked what he said because there's one key item, it's all dependent on how many they sell per year. If the number is 125K then that's great but if they only sell 20K, then it's a disaster. This is not where each Elio that rolls off the line shoots out a $1K bill. You lose money and then get to the tipping point where you start making it.
It's even going to be harder because there are a few things that Elio cannot change. Inflation goes up 2% per year and that's something which will reflect in the price. Same for the current trade war and that NAFTA does not exist. Price of raw materials and parts from various suppliers has gone up recently. Not to mention the price of airbags and controllers went way up after the whole Takata debacle. Remember it's been two years since the targeted $7450 was announced. Just taking inflation into account, that's now $7785 today. That will be at least $8100 by 2021. This is not taking into account USMCA which would easily add another $500 onto that, since Elio is 90% USMCA content. Think about it, $8600 in 2021 is a possibility and selling the first ones at $5500 is not looking good as this timeline stretches out. Plus that $411M they need ($531M minus $120M, which was priced out in 2017) would be $429M today.
For the ATVM loan, Elio will need to update some information so they can make sure they have all of their bases covered. If I was looking over their plan, I'd be wanting the latest update and the forecast along with it.
