I Have Given Up On Elio, Have You?

[RSchneider]

Can someone explain why the robots in the plant would be worthless now? I’m sure they’re dusty - maybe dirty. But if they work, they can be programmed right?

Did they just rot out?

The robots are worth lots of money. They can even be reprogrammed and updated.

That would be the least of my worries if I had that plant and equipment.

 

[dbacksfan81]

The "robots" are from when they started production of the second generation S-10 and S-15 which began in 1992, and eventually the H3. The plant has been idle for almost 8 years. So you have potentially 20+ year old robots and an assembly line that hasn't been used for almost 8 years, and the computer network that runs the equipment, GM probably took all of that since it was proprietary systems and software for GM.

Is the stamping equipment still there? I just think the cost of retooling, rehabbing and updating the robots, computer equipment to run the systems, and rehabbing the rest of the assembly line will run deep into the millions of dollars.

 

[RSchneider]

The "robots" are from when they started production of the second generation S-10 and S-15 which began in 1992, and eventually the H3. The plant has been idle for almost 8 years. So you have potentially 20+ year old robots and an assembly line that hasn't been used for almost 8 years, and the computer network that runs the equipment, GM probably took all of that since it was proprietary systems and software for GM.

Is the stamping equipment still there? I just think the cost of retooling, rehabbing and updating the robots, computer equipment to run the systems, and rehabbing the rest of the assembly line will run deep into the millions of dollars.

Definately. When GM was going to shut down that plant, they did keep it up to top notch shape. Only what it took to get whatever production they needed. Then add into that, ticked off employees that tend to sabotage equipment right at the end. From there 8 years of just sitting just ends up becoming a constant job of "let's see what happens when we start this." Sometimes it's OK and others, it's a disaster. Plus the maintenance of a plant that size is not like when it's running. Thus a major issue is the roof. When it leaks, who's there to report it? Probably nobody until someone comes around every week and notices it. Thus the equipment is never repaired. All of a sudden you have lots of rust. With Shreveport being a humid area and lots of rain, that's a constant battle which has to be kept up on.

If you read the SEC filings, you'll see that there's been a deal done with stock to pay for maintenance and property taxes. So, that's not a good sign when you can't pay to maintain it and know that you need to have the people you are leasing from to keep it at least not to turn into a disaster. That can only last so long and with the current price of stock, that's a hard sell.

 

[dbacksfan81]

If you read the SEC filings, you'll see that there's been a deal done with stock to pay for maintenance and property taxes. So, that's not a good sign when you can't pay to maintain it and know that you need to have the people you are leasing from to keep it at least not to turn into a disaster. That can only last so long and with the current price of stock, that's a hard sell.

This brings up something I have thought about, and could be an answer to the large sell off of stock over the last couple of months. It could be that who ever is doing any maintenance that was paid in stock, has sold the stock back to Elio even for a loss to recoup some of their costs. I'm sure that they're not going to go unpaid, and that could explain the $8 million loss in market cap. Just a theory.

 

[Samalross]

This brings up something I have thought about, and could be an answer to the large sell off of stock over the last couple of months. It could be that who ever is doing any maintenance that was paid in stock, has sold the stock back to Elio even for a loss to recoup some of their costs. I'm sure that they're not going to go unpaid, and that could explain the $8 million loss in market cap. Just a theory.

There is so little trading in the stock an 8 million drop in market cap could happen with 10 thousand shares sold. I could not see anyone working for Elio shares. Lichter might want to roof to leak and cause damage, to enable him to demolish the plant and redevelop the land

 

[RSchneider]

There is so little trading in the stock an 8 million drop in market cap could happen with 10 thousand shares sold. I could not see anyone working for Elio shares. Lichter might want to roof to leak and cause damage, to enable him to demolish the plant and redevelop the land

Don't forget about Hyundai Glovis. They lease part of the plant and use about 80% of the parking. So he can't let it go to pot.

Elio made a smart move though. December 2013 was the start of the lease for the plant. That was for 997,375 sq ft for $244,344. That resulted in 48 months of payments equaling $11,728,512. Starting in January 1, 2018, they reduced the space by 152,557 sq ft for a new total of 844,818. That reduced the lease payment to $211,205 and as of today that's $5,280,125. Elio has racked up $17,008,637 in lease payments alone.

In another smart move, Elio has paid off some of the lease with C and D Convertible Preferred stock. With amounts of $2,992,125 and $528,324. Then Elio deferred lease payments totaling $2,530,656 to be paid on January 1, 2019. Out of the total lease payments, Elio only had to pay $13,488,188 in cash. When the January 1, 2017, $2.9M in stock deal was done with 25K shares, January, 2, 2017 the volume for trading was at 150K and the price went from $12.67 to $8.95.

What I find interesting is that when you look at these numbers, it's easy to see where the money went and where it will have to go in the future. When people get all upset about Paul getting paid $250K/yr for two years, that's a drop in the bucket when it comes to all of the other expenses. Elio has paid around $13,949,657 cash for leasing that plant since December 2013. Elio raised $15,819,993 with the IPO. So, if you look at it in those terms, $1,870,336 would be left as of today if they just used that IPO for nothing other than lease payments. So by November 2020, all of the IPO money will have gone to just the lease payments. So Elio motors is eating through money by not doing anything. That's not a good situation to be in. With the stock in the toilet and getting worse, trying to pay the bills with stock is not going to work.

Also, I never got into the equipment cost that is dragging Elio down.

 

[Watashiwah]

Why do you think Paul only drew his $ 250,000 salary for only two years? Also, among many other questions, how much was ESG Engineering paid for ‘engineering services’? Would you care to speculate on what money was made for all that which was almost immediately obsoleted, and is there any reason to not assume Paul was drawing as much, if not more, for his ESG salary.

I don’t begrudge anyone making any amount of money, if it’s on the ‘up and up.’ Mostly everything was ‘win-win’ for Paul, Hari, and Co, but ‘lose-lose’ for the investors and stockholders. Plus there could have been all kinds of creative finance/vendor deals: there is so little, if any, honest information put out, that anything is possible with no explanation or oversight.

 

[Goat]

I began looking into Elio as a possible job opportunity a few months ago as I'm studying for a degree in Industrial Automation and Technology (Basically I build, repair, and program the automated processes on production lines.), but there's no job openings available on the Elio website. I'm rather saddened by this, as I was greatly inspired by Elio Motors' founding 10 years ago, and it actually led me to this field of study. Every year, I would send a Facebook Messenger message to Elio Motors, and every year I was answered by a courteous response ensuring the project will happen in time. This is the third year I've sent an inquiry, and I'm admittedly losing hope in the project. I feel if they actually got someone in leadership of the company that was a go-getter and was willing to put in the time, the project might still have a chance. Paul might be the founder, but he doesn't seem to have the drive to improve the company anymore--like he's just milking as much money from the company as he can before it completely goes under for good. I could be completely wrong, but it just seems that way. I still have a microscopic sliver of hope in the company since they got so close to production, but even that is faltering.

 

[Elio Amazed]

There is so little trading in the stock an 8 million drop in market cap could happen with 10 thousand shares sold. I could not see anyone working for Elio shares. Lichter might want to roof to leak and cause damage, to enable him to demolish the plant and redevelop the land

This is the last time I'm going to say this. Lichter does NOT own the plant. If he tried to demolish that plant, I'm pretty sure that, not only would his company be sued into the ground, he himself would be put in jail. Again, last time.

 

[Made in USA]

Can someone explain why the robots in the plant would be worthless now? I’m sure they’re dusty - maybe dirty. But if they work, they can be programmed right?

Did they just rot out?

Let me rephrase a little. The robots are worthless to anyone looking to buy the plant. They might be used by Elio Motors, but that doesn't seem likely. The problem with old robots, besides finding parts and programming, is that they are less reliable. A new company coming in would probably insist on updating so they could capitalize the expenditure. Depending on who made the robot, sometimes parts are hard to find due to obsolescence, and then there is the issue of finding a programmer that knows the old stuff. If Elio Motors does start manufacturing, they would be wise to have a couple not being used, except for spares. They would then schedule to replace them with newer. It's either that or accept the downtime. Just think of the problems Elon Musk had at Tesla with robots, and they were new.