Atvm Loan Is Not Completely Dead

[Watashiwah]

Thanks!! Have to say that that criteria makes sense to me, except maybe the steering wheel. I’m not sure a RWD ‘pusher’ configuration is sound. Seems it might be dicey: just imagining traction and control issues, center of road problems, ice and snow, oil buildup, etc. Enclosed seems reasonable for w/o MC endorsement (generally safer, fewer distractions; wind, noise, bugs) -probably helped get ‘helmet’ off the bargaining table as well as lessen crash testing requirements somewhat. Although MC don’t require crash testing, and conventional autos do, maybe in the eyes of the legislatures it made sense to offer up some protective enclosure.

Elio doesn’t appear too one way here to me, on this....

 

[RSchneider]

Forget all of the others joining in. The Autocycle Safety Act (remember I'm talking about the federal one, not the individual state ones) would make it harder for three wheelers coming to the market. Good to see it never go anywhere. It would push more for safety and as we know the current three wheelers FUV, Vanderhall, Slingshot and Solo do not have to go after making them at the level of safety that Elio will to do. So, I don't see any support from anyone else. It actually forces any of the Elio competition to have to incorporate the Elio Safety System and that just makes the three wheeler more expensive to produce.

 

[Rickb]

Shrewd? Most complain about government over regulation and you seriously want the Federal Government to create and regulate a new Autocycle vehicle classification??????? It would add time and cost to manufacturers trying to get their three wheeler vehicle concepts to the production start line. Please leave all three wheelers as motorcycle classed vehicles and let the States legislate their motorcycle registration, licensing, helmet requirements, and autocycle definitions needed to waive those motorcycle endorsement and helmet requirements.

 

[Watashiwah]

Rick, I agree completely! Just meant ‘shrewd’ from purely Elio’s (short sighted) business perspective. In their defense, maybe in the early days it made some sense to lean forward and anticipate the Feds and or the States creating roadblocks. I remember a poster, now maybe 5 to 7 years ago saying ‘Elio created an Elio sized hole in the legislation....’

I am all for less, and de-, regulation!!

 

[Samuel Gompers]

IMHO, all the legislative efforts made by Elio wrt autocycle definitions was misguided and a waste of limited resources. The only good changes, in my opinion, would have been to fix the narrow-spacing requirements for headlights on trikes. Elio was far too over-reaching in trying to craft legislation that made them the only "autocycle". As it turned out, they were unable to meet their own criteria.

 

[Samuel Gompers]

Forget all of the others joining in. The Autocycle Safety Act (remember I'm talking about the federal one, not the individual state ones) would make it harder for three wheelers coming to the market. Good to see it never go anywhere. It would push more for safety and as we know the current three wheelers FUV, Vanderhall, Slingshot and Solo do not have to go after making them at the level of safety that Elio will to do. So, I don't see any support from anyone else. It actually forces any of the Elio competition to have to incorporate the Elio Safety System and that just makes the three wheeler more expensive to produce.

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?

 

[RSchneider]

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.

 

[Ty]

When Paul and company calculated the cost of materials, rent, personnel, warranty, stores, etc., they came up with a cost per vehicle when built at the rate of 250,000 per year. The used that cost plus $1,000 to set the price. They'll profit another 20% on accessories. You were correct on those two items. They'll not do as well if production was cut in half but they probably won't be as bad off as Tesla when it comes to per vehicle losses. Not by a long shot.

Tesla delivered around 95,356 of its cars to customers in the second quarter of 2019.
Tesla lost $408,000,000 in the second quarter of 2019.
That means that Tesla, as a company, lost $4,278 per vehicle.

Now, that isn't bad considering all the expansion and building that Tesla has been doing. They are setting the groundwork for future profitability. Elio won't have the advantage of having people constantly injecting money into their endeavor. Tesla has managed to operate with a loss for years. However, Tesla, is kind of like Apple in how they are operating.

Back in 2007, the cell phone market was dominated by Nokia with 435 million units followed by Motorola with 164 million units. Apple released the first iPhone that year but it sold fewer than 4 million units. Now, Apple makes about 20% of all cell phones and almost all the profit... Tesla could do that when other manufacturers try to ramp up electric vehicles only to find there isn't enough battery capacity in the world to let them expand. Guess who will have all the batteries they need. That's right - Tesla!

What does this have to do with Elio? Not much. Sorry about the rambling. I suppose those old timers on this site know this already.

 

[James Reveal]

Hello all, I believed in Elio, went all in #12459 and bought almost 600 shares of stock. I was convinced that Elio was a great start. I have bought four cars since I went all in and I hold out hope that my Elio production number will be written on our calendar soon (lol). I can’t imagine how much fun it would be to drive and show off to all of the people that would ask about it. I don't believe the day will come but I can still dream.

 

[RSchneider]

The last loan was in 2011. So the reason why the program is continuing on is that Ford and Nissan have a few more years to pay off the loans (when they were approved and when they got the money is not the same date plus they didn't get it all at once, so it's payment is over 10 years from when they get that portion of money). Since Nissan and Ford are still paying on theirs, the interest payments each month keep a few people in DC employed. When both get done paying, then either they will have to loan out more or close up shop. Right now there's no rush to loan out any more money. Thus the 20 or so loan applications sitting on their desk, will sit there until whatever date Ford and Nissan are done. Then they will rush to loan out some more money, only to keep the cycle going.

This is why when you start up a program like this, it'll never be shut down. We all heard it was going to happen and you see the result. So, if this administration couldn't shut it down, nobody can. Best part is it's the carrot out there that people can still pin all of their hopes on or at least complain that if it was given to them, they would have been driving their Elio back in 2014. On the other hand, so can all of the other companies that either got rejected or just gave up on the ATVM loan program and either went belly up or found private investing.