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DOE grants $465m loan to Tesla Motors

22 Jan 2010

The US Department of Energy (DOE) has closed its $465m loan to electric vehicle manufacturer Tesla Motors for construction of a manufacturing facility in southern California on the Model S electric sedan and a power-train manufacturing facility in Palo Alto, California.

According to Tesla, the Palo Alto facility will assemble electric vehicle battery packs, electric motors, and related electric vehicle control equipment for the company’s electric vehicles and for sale to other automobile manufacturers.

The agreement was negotiated and signed by the DOE’s loan programmes office, which supports the development of innovative, advanced vehicle technologies to create thousands of clean energy jobs while helping reduce the nation’s dependence on foreign oil.

‘This is an investment in our clean energy future that will create jobs and reduce our dependence on foreign oil,’ said Energy Secretary Steven Chu. ‘It will help build a customer base and begin laying the foundation for American leadership in the growing electric vehicles industry. This is part of a sustained effort to develop and commercialise technologies that will be broadly deployed throughout the American auto industry.’

Tesla’s said its planned Model S will consume no gasoline and will not produce any tailpipe emissions, designed to offer a variety of range options depending on the battery pack used, from 160 to 300 miles on a single charge. Volume production of the Model S is planned to begin in 2012 with a target production capacity of 20,000 vehicles per year by the end of 2013. According to Tesla, the Model S project and power-train manufacturing facility are expected to create over 1,600 jobs.

The loan agreement is the second signed by DOE with an advanced technology vehicle manufacturer. In September 2009, DOE signed its first loan agreement for $5.9bn, to Ford Motor Company. The Department has also signed conditional commitments with Nissan North America and Fisker Automotive. Tenneco became the first advanced technology component manufacturer to obtain a conditional commitment from DOE in October of last year. Nissan plans to build electric cars and battery packs at the company’s Smyrna, Tennessee manufacturing complex, while Fisker recently announced plans to build plug-in hybrid electric vehicles by reopening a shuttered GM plant in Wilmington, Delaware.

The DOE was appropriated $7.5bn by Congress to support up to $25bn in loans to companies making cars and components in US factories that increase fuel economy at least 25 per cent above 2005 fuel economy levels. The Department said that it plans to make additional loans over the next several months to large and small auto manufacturers and parts suppliers up and down the production chain. The technical and financial review process is aimed at promoting multiple approaches for achieving a fuel efficient economy.

Copyright © 2010 NewNet

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One Response to “DOE grants $465m loan to Tesla Motors”

  1. I’m glad that the Department of Education has chosen to support Nikola Tesla (RIP) and the Tesla Motors cause, as he was one of the *greatest* inventors of the 21th century!

    LOL, I wouldn’t mind seeing “some” of that $465 Million in my bank account (wink wink)!

    Sincerely,

    Thomas Anderson

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