More and more people are considering an electric vehicle for their next car. I get the question all the time: Which electric vehicle should I buy? For the price, it’s extremely hard to argue with the Tesla Model Y or Model 3. There are signs, however, that this is a short-lived condition.
Here’s a fun fact: EV registrations grew 72% from January to April this year, due in no small part to changing tax incentives. Here’s another fun fact: 60.8% of those cars sold were Teslas, with 24 different marques having to share the other 39.2%.
That’s gonna change.
Ford’s $9.2 Billion Loan Is One Of The Biggest Ever
Exactly one month ago I wrote about how Ford made some big moves to secure more lithium resources for its future battery plans as part of its plan to win future electric market share. Today, we found out via this big exclusive Bloomberg piece, that Ford’s going to get $9.2 billion in taxpayer money to build the battery plant that uses some of that lithium.
Here’s what’s in the report:
A deep-pocketed US government program designed to finance futuristic energy businesses is issuing a conditional $9.2 billion loan to Ford Motor Co. for the construction of three battery factories. The enormous loan — by far the biggest government backing for a US automaker since the bailouts in the 2009 financial crisis — marks a watershed moment for President Joe Biden’s aggressive industrial policy meant to help American manufacturers catch up to China in green technologies.
The new factories that will eventually supply Ford’s expansion into electric vehicles are already under construction in Kentucky and Tennessee through a joint venture called BlueOval SK, owned by the Michigan automaker and South Korean battery giant SK On Co. Ford plans to make as many as 2 million EVs by 2026, a huge increase from the roughly 132,000 it produced last year.
The three-factory buildout by BlueOval plus an adjacent Ford EV assembly unit have an estimated price tag of $11.4 billion. BlueOval was previously awarded subsidies by both state governments. That means taxpayers would be providing low-interest financing for almost all of the cost.
That’s right. Taxpayers are basically paying for all of it. Then, on top of that, the automaker is going to be able to pass on $7,500 of savings to consumers via the IRA tax credit.
Good!
There’s a sweet graphic from Bloomberg that’s interactive if you read the story, but is sufficient enough to explain why I think this is fine:
Awesome graphic from the team over at Bloomberg, putting the scale of this commitment in the context of LPO’s other loans since our first one went out the door nearly 15 years ago. pic.twitter.com/TiHj38didj
— Nathaniel Horadam (@NW_Horadam) June 22, 2023
You see, back in 2008 we completely screwed up our economy due to something called the Residential Mortgage Backed Securities market (fun fact, from 2005-2007 I worked in the Commercial Mortgage Backed Securities market). Needing to keep the economy from slumping into a complete recession, the Obama Administration rolled out the Advanced Technology Vehicle Manufacturing program under the Department of Energy’s Loan Program Office.
Many of the loans didn’t work out, even if they were repaid. Solyndra, famously, went kaput. Fisker didn’t quite work out. Even the money Ford took was designed to help boost small car sales over SUVs, which obviously didn’t happen (though a lot of people kept their jobs). That little green dot with the arrow at the bottom? That’s $465 million to Tesla. While a huge amount of wealth there was created for Elon Musk, it was also created for investors, and workers, and helped kickstart the electric car revolution.
In my mind, you can take all of the money spent on all of those other projects and it’s worth it to get one Tesla. The Trump administration didn’t feel this way and, under Secretary Rick Perry, the LPO made like one loan to a nuclear facility. President Biden obviously feels differently and is using the Loan Program Office to make some huge bets.
Patrick wrote fairly persuasively earlier this week that many automakers clearly thought they could greenwash their way to the future, and are now grappling with the reality that they can’t. Ford is not one of those automakers. Yeah, they’ll still keep making trucks, but they’re two-feet in on this EV business.
Ford Is Actually In A Good Spot, Relatively
Demonstrating excellent timing, Automotive News has a story with a bit of perspective on the short-term winners and losers in the EV space this morning. As demonstrated by the market share numbers, the electric car market is growing, but it’s growing unevenly.
Chevy has a hit on its hands with the Bolt, but the Bolt is going away and none of the cars it’s replacing it with are seriously on the market. Nissan, which used to be the #2 EV seller in the United States, is struggling to get cars into the hands of buyers. The same is true for Porsche, Cadillac, Rivian, and Lucid. Whether its supply chain issues for longstanding manufacturers or awareness/price issues for new entrants, it’s hard to fight for the customers who aren’t just going to end up buying a Tesla. Add to that tax incentive woes for companies like Kia and Hyundai, and you can see why so many non-Tesla automakers are struggling.
Still, there are bright spots, according to Automotive News:
BMW’s EV registrations reached 10,680 in the January-April period, compared with 519 a year earlier. Mercedes-Benz’s EV registrations quadrupled to10,519, Experian said, and Audi generated a 31 percent gain to 6,283.
Who is best situated to pick up share in this market? It’s probably Ford, which suddenly has a lot of inventory on its hands, a new Tesla charging deal to get people excited about, and some new (for them) battery chemistry coming to market. Hyundai also has increasingly available vehicles, but they’re stuck leasing cars if they want to take advantage of tax incentives. From S&P Global’s latest inventory report:
At the end of May, Hyundai had the most EVs in dealer advertised inventory, at about 15,000 units. But the fast mover is Ford, which passed Hyundai in early June. Perhaps maximizing the marketing impact of its shared-charger arrangement with Tesla, Ford has tripled its advertised inventories of the Mustang Mach-E in little more than a month. By early-June, Mach-E inventories were at about 11,000 units – for a vehicle that has cracked the monthly 5,000-units-sold only once since launch, and which hasn’t broken 3,000 units yet this year. This could be a sign that Ford is truly entering the EV sales and share race. Not that VW is standing still, as its ID.4 advertised inventories have doubled to 10,900 units since early in the year – with no signs the Chattanooga factory is slowing down. On the flipside, at the beginning of the year, the Chevrolet Bolt had the most inventory of any BEV; now it’s a distant fifth.
I’m curious to see how Ford manages to sell (or not sell!) Mach-Es this summer. It might be a good time to try and get a great deal.
Lithium Iron Phosphate Seems Like The Future (Of Affordable EVs)
I’m gonna beat this drum until my arms fall off, but based on what I’ve read, it seems that a lithium iron phosphate (LFP) battery is the best battery chemistry for most cars and should increasingly become the choice for most consumers. BYD figured this out ten years ago, Tesla came to this conclusion two years ago, and it seems many automakers are starting to come around to the idea.
Check out this analysis from Reuters and Paul Lienert for a good summary of why:
“LFP is less expensive than cobalt and nickel, and all the minerals can be obtained here in North America (which means) much lower transportation costs and a more secure supply chain,” said Stanley Whittingham, professor at Binghamton University in New York and a 2019 Nobel laureate for his work on lithium ion batteries.
The addition of manganese, a staple ingredient in rival nickel cobalt manganese (NCM) battery cells, has enabled lithium iron phosphate cells to hold more energy than previously, providing EVs with more range — up to 450 miles (724 km) on a single charge, Toyota said recently.
NCM batteries have the big advantage of being able to delivery more range, which has been a key factor for a lot of people. Still, LFP batteries have so many other advantages that a small amount of difference in range seems like it’s worth the tradeoffs.
For instance, Ford was able to lower the price of its Mach-E by $4,000 with the introduction of the LFP packs while still nominally increasing range (likely due to other factors). These batteries also charge faster and last longer. Also, the graphic above is something I found on the Ford media website and was too goofy not to use.
The future of the future is probably LFMP batteries, which use a bit of manganese in the mix to get an energy density closer to NCM or NCA lithium batteries. It’s a good enough solution that’s also cheap enough. Sounds like a winner to me.
The BYD Dolphin Is Coming To Europe
Oh, hey, BYD news. How timely. While the Biden Administration and a large chunk of automakers do all they can to make American-built cars the EVs of the future, Europe has been less well positioned to resist the pull of cheap Chinese cars.
While China’s BYD has all of us infatuated by the tiny and cheap Seagull, it’s the slightly larger Dolphin that’s packing its bags and heading to Europe. BYD announced that it’s bringing the C-Segment EV to the continent with deliveries starting later this year.
The big news here is the small price. A basically VW Golf-sized Dolphin will cost approximately between £25,490 to £30,990 (or about $32,500 to $40,000) and deliver a range between 193 and 265 miles on the WLTP standard.
By comparison, a comparable Volkswagen ID.3 PRO starts at $42,800 in Germany and only delivers about 266 miles of range.
The Big Question
Is this how you want to spend your hard-earned tax dollars? Is it worth it to compete with China’s dominance in the industry?
Photos: BYD, Ford, Bloomberg
Hey now, you didn’t put “buying me a gently used Cayenne” on this list.
(Oh, wait, you’re talking Ford deal. I’m okay with it.)
We will never know the full details of the Ford loan because I guarantee it’s a sweetheart deal. Minimal interest, favorable repayment terms, the kind of loans that are best suited for multi-national conglomerates worth billions.
Us proles are stuck with 7% APR from a for-profit bank.
Yes, that’s right, give the globally successful company valued at $57bn dollars a $9.2bn loan, to compensate for their complete lack of foresight and planning. That’s $27 from every single person in the USA. I’m sure Ford, the for-profit company, will pass on their profits to the general public, and not use those profits to gain even more profits.
David Tracy buys an i3, and suddenly BMW EV sales skyrocket.
With great power comes great responsibility.
“Is this how you want to spend your hard-earned tax dollars? Is it worth it to compete with China’s dominance in the industry?”
Supporting a successful company to be even more successful in a new venture with the near 100% probability that the loan will be repaid? HELL YEAH. I can’t think of many better ways to
spendinvest tax dollars.Is it worth it? It will be if it works out. Contrary to the doom and gloom bullshit that “you can’t beat a cheater”, I was raised to believe that “cheaters never win” (in the long run). I mean, tell that to the USSR – oh wait, you can’t! I’m no blind apologist for the USA, but I do think that when we pull together, there are few obstacles we can’t overcome.
I have to say, the Dolphin has the best take on the superfluous side creases I’ve seen yet, making them a forward extension of the rear wheel arches works way better than whatever the hell Hyundai’s been doing.
I’m confounded by the analysts that state these battery minerals are not found in North America. Sure, maybe not as abundant (I’m no expert) and labour costs are going to be higher than developing countries or allegedly forced labour, but this stuff is here.
Canada even has a town called humorously Cobalt. It was a silver mining town and cobalt kept getting in the way. It was a prolific byproduct nobody wanted. You wouldn’t even need to mine all of it, just dig it out of the pits it was dumped in. And then there’s Sudbury, nicknamed the Big Nickle. Care to guess why? These aren’t even difficult remote locations to get to. There’s plenty more in remote places with some investment.
I totally share the concerns about the environmental degradation of mining (apparently lithium is pretty bad), but degrading the environment in other parts of the world is not the solution. We either pay the price for our lifestyles or seriously re-think our transportation patterns.
Your right but that’s not how we roll in the NIMBY States of America.
The Sudbury Blueberry Bulldog are my favorite Senior-A Whale Shit Hockey Team.
There’s nothing alleged about the forced labor, read slavery, involved in mining those minerals.
Or we could loan Amtrack a couple billion to maybe help make trains a functional option. Thus minimizing the need for cross country transport via. Allowing consumers to transition electrical vehicles easier. Likely adding more jobs spread further across the country. But then you would have to be in a big car full of the poors for awhile and that’s gross.
And spend even more to rehab or rebuild old tracks that are no longer used. While I’d love for public transportation to become viable again outside of major cities, lobbyists, lawmakers, and most voters seem to disagree.
I don’t live near any Amtrack corridors, so I haven’t been on one of them. How much can they tow?
Depends on grade and locomotive but in generalization minimal grade roughly 150k tons. Real talk though, this whole distraction of every man pulling his load via F350 across the Great Plains is such a small percentage of traffic that it should be just ignored and allowed to exist as is for now. Most cross country non-commercial traffic is single cars. They tend to go places where they A. Know people to pick them up B. Urban areas with public transport. As population continues to concentrate in cities, a viable and effective train system would limit the desire to drive hundreds of miles in one go. Thus we don’t need 500 mile battery packs. Thus limiting the amount of cobalt what not we need from Chile. Making cheaper electric cars more viable. And limiting the amount we need to expand freeway traffic. Allows for open roads for commercial traffic, making commerce more effective. Like I live 2 1/2 hours out of Boston in a rural town. I can ride my bike 9 miles to the train station, get on the train and get to Boston, then take little trains, buses or ferries where ever I need to go. It’s cheaper, faster and easier then driving. I like cars, I have seven of them. But spending hours going one speed down a freeway is something I look forward to ending.
I’m with you there. I was in Italy a few weeks back and we hopped around a few places on the train-no fighting traffic into the cities, traffic jams, etc. Just cruising at 100+mph, cutting trip time by over 50%. If my wife has to learn to pack a little lighter than so be it. Also keep in mind-If your car doesn’t need 500+ mile range, it becomes so much easier and cheaper to buy something fun.
I will note though, my one and only Amtrak experience was absolute shit
Which is absolutely by design. With commercial traffic taking priority over passenger traffic and those PSR trains being 3 miles long, making them unpassable, and can’t fit in a yard. Functionally making trains outside of the Northeast corridor useless. We could make train travel significantly better for cheaper then 9 billion if we just went back to ye olde hub and spoke and stopped subsidizing OTR so much.
Yes this is definitely a structural problem. We are finally getting serious about twinning tracks here in Canada for passenger, but there are some choke points like expensive bridges that look like they will take a long time to fix. I still think it’s important to do the best on commercial priority, though. We also need to keep more long haul trucks off the roads by making rail work properly.
Outside of my snark, I totally agree with you. Most of my intercity travel where possible in Canada is with VIA rail, or Go in closer commuter towns. Despite reliability and occasional labour disruption, far less hassle than driving. I haven’t been much in the US East for a while, but regularly in the California bay area, Caltrain has served me well. Heck I’ve even been the only person in the Caltrain car playing musical chairs by myself. I’ve never understood why the locals don’t understand the great option they got.
As for towing, we all know for most it’s not the need, it’s the consumerism of owning the tow vehicle. Taking the train lacks status for too many people.
In 2000 the average freight train hauled 2,923 tons; in 2020, that average rose to 3,187 tons.
According to Union Pacific https://www.up.com/customers/track-record/tr030822-12-train-facts-you-might-not-know.htm#:~:text=Most%20rail%20cars%20can%20have,the%20interstate%20is%2080%2C000%20pounds.
Wow and kill American jobs? What about the economy? What’s wrong with you? We need to force citizens of this country into the single most deadly activity every single day of their lives and make sure the people that can’t afford it to stay out of our beautiful suburbs.
If people actually cared about the environment and not just trying to checkmate the Chinese for whatever reason, we’d have the best public transport in the world. Follow the money and you’ll figure out quickly why we don’t.
Except for the Elon Musk factor. I’m not buying anything that Musk is involved with.
I didn’t leave the country because Trump was president. Stop bring childish and start making informed decisions! This article only proves, yet again, how much better Tesla (and other Musk ventures) has been since inception than damn near ANY other for profit company in America.
Just cus you don’t like the guy, doesn’t make him wrong, or evil.
I would like to understand more about your comparison of the energy density for lead-acid, LFP and LMP technologies.
A quick search seems to indicate the energy density of lead acid is 30 to 50 Wh/kg, and the energy density for LFP is 90-120 Wh/kg. The data I have is old, and the energy density for LFP may be higher today. There are other important factors to consider. Lead acid cells can withstand 300 discharges to 80% and essentially a handful below 50%, and a lithium cell’s life is 3,000+ discharges to 50%.
I’d much rather our tax dollars be spent driving the country into the future and generally helping the greater good than the money be spent trying to find 5 idiots on the bottom of the ocean.
Not to mention the lives put at risk to search.
I don’t think the 19-year-old has had enough life experience to be labelled an idiot.
He may not be, but his father gets double idiot billing then.
I guess since he’s 19, no longer a tax write off for daddy, just a liability.
Wow. Do you wish death on everyone that has more money than you? Race car drivers, motorcycle riders, football players, all should die? If you’re ever in an accident make sure you wave off any help. You’re no idiot.
You make some fair points, but you’re completely wrong about LFP batteries compared to lead-acid. Yes, lead-acid batteries have specific power ratings around 200 W/kg, but LFP batteries are around 1200 W/kg (http://www.litrade.de/pub/HeadWay%20LiFePO4%2038120__%20Specifications1.pdf). But what’s much more important is the power density, which is about 30 Wh/kg for lead-acid and around 140 Wh/kg for LFP. There’s also the very important fact that lead-acid batteries can only sustain around 500 charge cycles (at 40% depth of discharge) while LFPs can sustain around 12,000 cycles at 80% d.o.d. So, “you may as well be carrying 12V deep cycles instead”? Uhhh, that’s a big NOPE. (https://en.wikipedia.org/wiki/Comparison_of_commercial_battery_types)
Finally, equating density with overall mass is also disingenuous at best. Sure manganese is denser than aluminum (about 3 times) but is slightly LESS dense than iron. If only a small percentage of manganese is used in the battery, it won’t necessarily increase the overall mass or dramatically affect intensive characteristics like power density.
Sorry- I meant energy density, not power density. In my haste I typed that incorrectly.
“Is this how you want to spend your hard-earned tax dollars?”
it depends…
what are the repayment terms (interest rate and schedule)?
what is projected range of contributions to future tax revenue?
was it in budget approved by congress (us) – (didn’t we have a debt default crisis recently)?
Yeah, that’s the key. If the money gets paid back in full with decent interest, then we (the taxpayers) aren’t *technically* spending anything, but we’d have to compare it against what the alternatives might have earned instead and the full lifetime value of each
I agree with the loans to Ford. If Chinese EVs make it to the US it will probably spell the end of the US automaking industry. Americans seem happy as hell to buy cheap shit even if it burns their houses down. Given a choice to pay $25k for a cheap EV they will do so. And I would not at all put it past the Chinese automakers to dump product and price them at below cost in order to drive the competition out of business.
The US needs to get its EV battery factories up and running ASAP and get those prices down. Because at some point those cheap Chinese EVs will be here.
Problem is on all sides they are claiming the efforts to reduce EV & battery prices? Do you believe that is actually going to happen? How many EV models do you think the US big 3 will have sub-30k without tax breaks in the next 5 years? Any 30k’ish EV they produce without tax breaks is going to be a low range or just as much of a POS as the imports. 90% of all EVs produced in the next 5-10 yrs will be $50-100k, 9% $100k+, maybe 1% affordable.
Yes, batteries will indeed become better and cheaper — and people’s interest in buying EVs will do more to speed the R&D along than anything else.
By the time todays battery becomes cheap enough that there’s a noticeable savings to the consumer, we will have moved on to the newer tech more exp battery, and so on and so on. By the time a battery EV will be cheap enough for the average family to buy new and replace their ICE car, we will be on the next iteration of technology which is not a battery EV. People need to realize the pipe dream affordable EV is not going to happen anytime soon. In 2030 Ford & the Govt will announce this deal is paying dividends, Ford has an affordable EV below the $60,000 avg cost of a new car, the new Ford only costs $59,995!
As long as ford pays back the loans and the interest rates aren’t lower than what the government pays, it doesn’t bother me. In an ideal world, they’d balance their budget and just use some of the last years profits, but it’s what we live in. We need home grown EVs and this accomplished the task without much actual cost.
The fact of the matter is most people are not super well off, and most of those that are comfortable got that way through careful budgeting and saving. Expecting the bottom 90% of people to voluntarily pay an extra 50% for a car, just to say it isn’t from a Chinese brand, is not just idiotic but cruel. Over half that damn VW is probably sourced from china anyways. The only way to stop it is to put massive tariffs on them, or make some kind of reciprocal law that says car makers cannot freely operate here if ours can’t do so in their home country. To be clear, I’m for that, because I wouldn’t put it past the Chinese government to build in features allowing them to brick the cars, or run other makers out of business only to hold car shipments hostage. It is a *massive* security and economic vulnerability to let those cars onto the market, given our dependence on cars as a nation.
If you’re going to apply logic and facts, sir, you are not permitted to play this game. Harumph and good day!
Yes, decarbonizing the economy is right up there with healthcare as things the government should spend money on instead of fossil fuel subsidies and blank-check corporate welfare for defense contractors. It may be a big loan in a vacuum, but how does it compare to current and historical public spending on fossil fuels and related infrastructure? How does it compare to weapons systems of questionable utility and value?
Problem is with anything the govt throws money at or writes blank checks for, the benefit received is not worth the cost to the taxpayers. Companies love these initiatives as they will be overpaid for delivering a subpar product. Even with healthcare, ACA has driven up costs while reducing benefits, plus the govt spent billions on Fed & State systems to handle it which are garbage. For profit or non-profit, no matter what good, noble, or whatever business they are in, there are always useless executives running it collecting giant salaries.
Wow. Your first sentence alone is one of the most blanket statements I have ever read! Do you mean things the government invests money in (which is what a loan is)? Do you have evidence that such loans are never worth the cost to the taxpayers? Ever?
I’m not even going to touch the rest of your comment, as it’s full of the same blanket, unsupported assertions.
Show me evidence to the contrary, bet I can find more examples than you.
You made the assertions. I don’t intend this to be rude, but I’m not interested in doing homework to argue with an internet comment. Of course there are examples aplenty of government investments that have panned out and not panned out. But to state that government investment in research and product development are never successful or beneficial to society is obviously incorrect.
You’re all over this thread with extremely cynical comments about government investment in its own economy. That’s fine for you. Not for me.
Agreed, It seems there’s been a lot of “through money at the problem” ask the necessary questions later. Acknowledge battery/electric motor most efficient means, but despise the seemingly unstoppable trend to turn cars into mobile info gathers, with all the vulnerabilities involved. We do need to encourage strategic development though. China did;
China’s government made EV development a core part of its economic plan in the early 2000s and spent more than 200 billion RMB ($29 billion USD) between 2009-2022 in tax breaks and subsidies.Mar 1, 2023
Why Capturing China in an EV Investing Strategy Matters
ETF Trends
https://www.etftrends.com › climate-insights-channel
Nothing to see here, whoops.
? thanks ?
Your 4l I6 is very reliable after you reseal the valve cover, the rust prone U Chanel frame though.
Seems like the cheaper and easier solution would be to pass a bill that copies China’s 100% tariffs on foreign made cars but instead have it only apply to Chinese cars.
But that would be rrrRR, RRrrrr, rrrrraa. I won’t say it, but that’s what the pro-China front will accuse us of.
But eventually they will find a way. How did China handle the import tariffs on solar panels, they just setup operations to make them or “pass” them through other countries. Oh then the govt last year lifted the import tariffs on those countries turning a blind eye to the actual source. Trust and believe the govt is fully supporting Ford or GM, yeah right, in a few years after backdoor elitist deals they will screw them and all of a sudden reduce restrictions to Chinese EVs.
Most of those EVs are overpriced. The going away Bolt was a fair price, but it’s going away.
I really want Rivian and Lucid to succeed. We need more EV options from car companies run by adults and not a fascist man-child.
Rivian offers cool colors and even offers the green interior with every exterior color 😀
Obviously you want the green interior, but which exterior color would you get with it? H+Green, yellow, red, or blue? hmmmmmmmmmmmmm
Tesla, Lucid, and the others need to also start expanding their color palettes.
Happy to know my tax dollars are being spent to fund a private for profit company to make massive battery $100k Truck & SUV EVs profitable for them.
There is alot to discuss and debate about this (see other posts), but Matt buried the fact it is a LOAN. As long as it i paid back, then your tax dollars didn’t buy anything.
Bonus: What are the interest terms of this loan?
If it’s right in the headline is it still buried? Although some of Matt’s comments seem to indicate he isn’t convinced…
You are correct, I shouldn’t have said “buried”. It was in the title, but then he proceeds to talk about it like it’s just free money. It’s like he copied that part of the headline, “$9.2 Billion Goverment Loan” but didn’t really understand what it meant.
Send me the headline in X years when Ford repays the loan in full with $0 cost to the taxpayers.
Yes the terms of the loan as well as considering the interest the government is paying on it too. It’s not like there’s a pile of cash sitting around for them to loan out. There’s over 31 trillion in debt and they have to borrow this in order to loan it in the first place.
What’s your alternative solution for competing with China in this space?
There is probably no solution, that will be implemented anyways, full speed on the unstoppable giant battery EV train. Just like the solar panel saga, govt imposes giant tariffs on solar panels, progress on solar plummets, govt says solar panel growth & cost is below targets, govt removes import tariffs on countries where “Chinese” panels are being funneled through. Chinese EVs will be here eventually and affordable big3 EVs will not exist until there’s low cost competition.
If you want to get ahead of China on battery production, you have to invest. Ford seems like a pretty safe investment.
If they pay it back, why not? Our gov gives sooo many loans out, this one just happen to make the news cycle
They are a private for profit company, issue corporate bonds or additional shares of stock.
You’re implying our gov doesn’t give loans to other for profit companies? If so, you’d be wrong
Obviously, almost none of it should be happening, just deals between those with power to make people richer & more powerful.
The government gives both loans and tax breaks in many many areas. This is how our representatives push our economy and our society in a direction we (well the majority anyway, … of lobbyist I mean, the majority of lobbyist) want it to go. Short of having a complete capitalist free-for-all, which real people don’t want, but we’re moveing towards, this is normal.
Why? Ford had the opportunity to be ahead of Tesla, why are we giving them tax money to catch up?
It’s a loan, not a grant. Assuming Ford doesn’t go belly up like Fisker or Solyndra, we’ll be getting that money back with interest… eventually… some day…
Anyway, I feel like Ford is a better investment risk than either of those two companies. Even GM paid back their bailout money. In the meantime it means jobs and income tax money and helping us reduce reliance on China. I’m ok with this one.
A lot of GM’s bailout money was in the form of gifts and grants that didn’t need to be paid back, they did pay back the portion they had to, but the government still was out over $11 billion in funds to NGMCO LLC/General Motors Company that wasn’t in the form of loans
Our government is loaning money to bolster US competitiveness in the global electronics market. For a number of reasons (some of them with less merit than others), this JV was considered the best candidate for this particular loan.
As part if infrastructure improvements yes. Add more working charging stations, better roads, etc,
Granted the cost of a new EV is way out of line and used ones can rack up battery replacement charges.