Photograph by Patrick T. Fallon/Bloomberg

Tesla Motors Inc. logo is seen on a Model S sedan after the grand opening of the Tesla Supercharger station in Lebec, California.

Updated with Musk tweets, 3:20 p.m. EST

Tesla Motors Inc. yesterday crowed that it was the first and only U.S. automaker to pay back its loan from the U.S. Department of Energy.

“Following this payment, Tesla will be the only American car company to have fully repaid the government,” the company said in a statement after paying $451.8 million remaining on the loan it was awarded in 2009.

Chrysler Group LLC took umbrage with its reading of Tesla’s claim.

“The information is unmistakably incorrect,” spokesman Gualberto Ranieri wrote last night. “It’s pretty well-known that almost exactly two years ago – May 24, 2011 – Chrysler Group LLC repaid (in full and with interest) U.S. and Canadian government loans more than six years ahead of schedule.

“Question: short memory or short-circuit?” Ranieri asked.

As long as we’re broadening the scope beyond Energy Department loans — intentionally or not — Chrysler Group isn’t even the only automaker named Chrysler run by a charismatic Italian to have paid back government loans.

Chrysler in 1983 repaid $1.2 billion in loans guaranteed by the U.S. in a bailout that netted about a $300 million profit. Then-chief executive officer Lee Iacocca, now 88, paid the last $813.5 million in a New York ceremony in August 1983.

Some may quibble about Chrysler’s characterization of its own repayment. The automaker indeed paid back its loans in May 2011, six years ahead of schedule, under CEO Sergio Marchionne. The following month, the Treasury Department sold its last remaining equity interest in the company. The government has said Chrysler returned more than $11.2 billion of the $12.5 billion committed to the company and that it’s unlikely to fully recover the remaining $1.3 billion.

Chrysler says the $1.3 billion difference refers to the loan to Old Carco, the Chrysler that has been in bankruptcy since 2009, not Chrysler Group, the new company formed on June 10, 2009. Chrysler is majority owned by Turin, Italy-based Fiat SpA.

Tesla CEO Elon Musk fired back at Chrysler’s statement on Twitter today:

As many have already noted, @chrysler is a division of Fiat, an Italian company. We specifically said first *US* company.

— Elon Musk (@elonmusk) May 23, 2013

More importantly, @chrysler failed to pay back $1.3B. Apart those 2 points, you were totally 1st detroitnews.com/article/201305…

— Elon Musk (@elonmusk) May 23, 2013

Tesla’s repayment of the Advanced Technology Vehicles Manufacturing loan earned taxpayers $15 million to $20 million, Musk said in an interview yesterday. The Energy Department puts the profit closer to $26 million, Bloomberg’s Alan Ohnsman reported.

The gain U.S. taxpayers stand to make from the Tesla loan won’t offset losses of as much as $217 million they may sustain on loans to Fisker Automotive Inc. and closely held vanmaker Vehicle Production Group LLC. Both companies have stopped production, missed their first loan payments and are trying to sell their assets. The Energy Department recouped $26 million by seizing reserve accounts the companies set up to get their loans.

The three companies borrowed only about $1 billion of the more than $8 billion given out under the alternative- energy vehicle program, however. The program was created under President George W. Bush and implemented by President Barack Obama in 2009.

Ford Motor Co. and Nissan Motor Co. were by far the largest recipients of the Energy Department loans. Ford got $5.9 billion and said in a May 1 regulatory filing it has $5.5 billion outstanding. It is making quarterly payments of $148 million on a payment schedule that goes through June 2022.

Nissan hasn’t released details about its $1.4 billion loan repayment record or schedule. It received money to develop the all-electric Leaf and the batteries that power it.

Losses across Energy Department loan programs represent 2 percent of the $34 billion lent, and less than 10 percent of the reserves Congress established, according to a department fact sheet.

With assistance from Alan Ohnsman in Los Angeles, Craig Trudell in Southfield, Michigan and Angela Greiling Keane in Washington, D.C.

Original post is Chrysler Refutes Tesla’s Repayment Claim by Political Capital.

Photograph by Chris Thompson/SpaceX via Bloomberg

Space Exploration Technologies Corp.'s (SpaceX) Falcon 9 rocket takes off in Cape Canaveral, Florida.

Elon Musk, the Silicon Valley entrepreneur who splits his time between running the electric car-making Tesla Motors Inc. and rocket-making Space Exploration Technologies Corp., sees “good economic times ahead” for the U.S.

His Tesla, which received $465 million in federal loans in 2009 from the Obama administration to develop and build electric Model S sedans, had been cited as a “loser” company by Republican Mitt Romney in an Oct. 3 presidential debate — the same day Musk said the car-maker was making an “advance payment” for the federal loans.

SpaceX has a $1.6 billion contract with NASA for at least a dozen resupply flights to the International Space Station.

Post-election, Musk has shared his views about the economy going forward. He had declined to discuss Romney’s comments, didn’t publicly support either him or President Barack Obama and says he doesn’t expect “any significant impact” on either Tesla or SpaceX with the president’s re-election.

“The economy is improving quickly. This would happen no matter who is president,” Musk said. “I don’t think people appreciate that the president is like the captain of a huge boat with a tiny rudder.”

The slowly improving real estate market bodes well for continued economic recovery, he said.

“Now we’ve used up the housing stock and the housing industry is ramping up to normal employment levels. Housing, fully considered, is the biggest sector of the economy, so this will of course have a big positive effect on the economy,” he said. “Good times ahead!”

Balancing the budget must become Obama’s top priority, he said: “By this, I mean at least get the deficit under half a trillion. This needs to happen mostly through spending reductions, but will require some increase in taxes.”

It’s “obvious to everyone” that drastic cuts in government spending are necessary, he said, suggsting it wouldn’t be so bad if the automatic spending cuts that are part of the year end fiscal cliff took effect — given a choice between that and no cuts, he’d take the sequestration.

“The toughest challenge for the president will be cutting government spending,” Musk said. “Every special interest will lobby extremely hard to keep their funding, so fighting them will take incredible resolve.”

“This is the best thing about second-term presidents — they can afford to upset the system and not worry about re-election. President Obama cares about his legacy. He doesn’t want to leave office with the biggest deficit in history.”

Original post is Legacy-Conscious Obama Sure to Act on Deficit: Silicon Valley’s Musk by Political Capital.

Today’s bankruptcy filing by A123 Systems Inc. may give the Romney-Ryan campaign, just in time for tonight’s presidential debate, a company that fits the label that it’s tried to hang on other recipients of Obama administration financing to develop electric vehicles.

A123 got about $249 million in grants from President Barack Obama’s 2009 stimulus plan to build an electric-vehicle battery plant in Livonia, Michigan. The plant produced the defective battery packs for Fisker Automotive Inc.’s $103,000 Karma — its design financed by an Energy Department loan — that caused one of the cars to quit running during a road test by Consumer Reports.

The magazine’s testing editor subsequently called the Karma a “basket case.”

Fisker’s recall of the Karma to replace the bad battery packs cost A123 $55 million, leading to the financial drain that culminated in its bankruptcy filing. 

It also added collateral damage to Fisker’s self-inflicted wounds that prompted the Energy Department to freeze most of the company’s loan money last year. Fisker suspended work on reopening a former General Motors Co. plant in Vice President Joe Biden’s home state of Delaware to build its second model, a project that was supposed to create 2,000 jobs.

Republican Mitt Romney and running mate Paul Ryan have most often tagged Fisker with the loser label, with Ryan pointing out in last week’s vice presidential debate with Biden that the company’s loan money was used on a car that’s assembled in Finland. Romney has also mentioned Tesla Motors Inc., which has noted that it’s about to start repaying its Energy Department loans.

Romney, Ryan and members of Congress, including Rep. Cliff Stearns of Florida, have taken their shots at lumping various recipients of electric-vehicle financing together as “losers.” Most of those slams have been directed at which among them got about $1 billion in Energy Department loans to make luxury plug-in cars. It hasn’t necessarily stuck, particularly with Tesla, which has noted that it’s about to start repaying its loans early.

Angela Greiling Keane contributed to this report.  

Original post is Car Battery-Maker’s Bankruptcy: `Loser’ Fodder for Romney Debate by Political Capital.

Photograph by Tim Rue/Bloomberg

The Tesla Motors Inc.'s Model X vehicle at its unveiling in Hawthorne, California.

In last night’s debate, Republican presidential candidate Mitt Romney singled out four recipients of U.S. Energy Department aid as he lumped such companies together as “losers.”

Romney was essentially repeating a refrain he’d used last week at a campaign event in Pennsylvania, except that in the debate, he said a “friend” had used the term “losers.”

Romney was criticizing a George W. Bush-era program intended to spur the development of greener cars and energy sources. Ford Motor Co., the only major U.S. automaker that didn’t receive a federal bailout, and Nissan Motor Co., which hasn’t had an unprofitable quarter since 2010, received most of the money from the same program that funded Tesla Motors Inc. and Fisker Automotive Inc., two companies Romney named.

Tesla said yesterday, just hours before the debate, that it would begin repaying the U.S. government early for its $465 million loan.

“Don’t forget, you put $90 billion, like 50 years’ worth of breaks, into — into solar and wind, to Solyndra and Fisker and Tesla and Ener1,” Romney said as he attacked Obama’s tax policies. “I mean, I had a friend who said you don’t just pick the winners and losers, you pick the losers, all right? So this… is not the kind of policy you want to have if you want to get America energy secure.”

Does that make Ford and Nissan losers by default?

Nissan and Ford wouldn’t touch that question directly.

“I never heard the presidential candidate use the word Nissan,” spokesman David Reuter said.

“Our ’One Ford Plan’ is working,” said Ford spokeswoman Christin Baker. “The company has had 12 consecutive profitable quarters. Our ongoing introduction of new products is leading in quality, fuel efficiency, safety, smart design and value.”

But it’s got to sting for two establishment companies to be lumped together with two failed enterprises and two start-ups.

The startups – Tesla and Fisker – wouldn’t consider themselves losers either. In addition to its loan announcement, Tesla said yesterday it expects to be cash-flow positive by the end of November with a quarterly profit in 2013. Fisker, which was cut off from drawing down more of its loan last year after failing to meet milestones, just raised more than $100 million from private investors to keep developing a second car.

Ford, which got $5.6 billion in loans, has been trumpeting its new C-Max, which will only come in hybrid and plug-in hybrid electric versions in the U.S. The company used U.S. money to develop its EcoBoost engine, part of its strategy for increasing  fuel efficiency in its cars and trucks. Customers can even buy the engine in the F-150, the best-selling passenger vehicle in country.

While Romney complained about Obama being too generous with taxpayer money for green energy, companies including Chrysler LLC have complained about the administration not giving out billions of dollars it could have lent. Chrysler and General Motors Co. both pulled their loan applications after delays in decisions from regulators. Start-ups Bright Automotive Inc. and Carbon Motors Corp. complained that their applications had fallen victim to politics earlier this year after the Energy Department loan programs became a political football following Solyndra’s bankruptcy.

Meanwhile, Romney should be familiar with failed automakers from his youth when dad George was CEO of American Motors Corp.

Not familiar with that company’s cars?

That’s because it was absorbed by Chrysler a quarter century ago.

An automotive loser, so to speak.

Written with Alan Ohnsman

Original post is Romney’s `Losers’ Overlook Ford, Nissan — and Tesla Repaying by Political Capital.