Detroit, Mich. — In addition to Ford and Nissan, the Department of Energy also doled out $465 million in federal loans this week to Tesla, a Silicon Valley-based maker of electric cars for the rich. Taxpayers should find this Tesla investment offensive for a number of reasons.
CAFE COMPLIANCE? The $25 billion DOE program was originally designed to help automakers meet Congress’s absurd 35-mpg-by-2015 fuel-efficiency mandates, a federal intrusion that is estimated to cost the industry $85 billion. As a start-up automaker producing only niche electric vehicles, CAFE laws are of little concern to Tesla.
Indeed, Tesla’s 2008 CAFE rating was 244 mpg, based on the first vehicle it produced — the $110,000 Tesla Roadster sports car. Which means, if Obama’s cap and trade scheme goes through, Tesla actually stands to profit from CAFE laws even as it takes millions in federal dollars designed to help the company cope with them.
Automotive News reports that Tesla Vice President Darryl Siry says that the company is eager to sell its CAFE credits when trading begins. “It’s all upside for us,” he said. Indeed.
WELFARE FOR THE RICH: Tesla makes cars for the well-heeled. The company will spend its taxpayer millions on producing its second vehcile, the $60,000 Model S sedan, aimed at a consumer demographic accustomed to patronizing BMW and Mercedes. In fact, Mercedes just bought 10 percent of Tesla worth $50 million.
And though Tesla has struggled to make ends meet, Tesla’s CEO is hardly in need of government support. He is Elon Musk, the billionaire founder of PayPal. Congress may object to Detroit CEOs traveling to DC in corporate jets, but Musk just flies his own Dassault Falcon 900.
PELOSI PORK: California pols have made no secret of their contempt for Detroit and its “gas-guzzlers,” and Speaker Nancy Pelosi and Sen. Diane Feinstein in particular have lobbied hard for federal dollars for a new generation of green California carmakers. Henry Ford didn’t need federal pork to start Ford Motor Company, but apparently Silicon Valley billionaires aren’t ashamed to take it.
Your tax dollars at work.