Electric carmaker Tesla pays off U.S. loan

Wed May 22, 2013 5:51pm EDT
 
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By Ben Klayman

DETROIT (Reuters) - Electric carmaker Tesla Motors Inc (TSLA.O: Quote) on Wednesday paid off its U.S. Department of Energy loan nine years earlier than required, using money raised last week in a stock and debt offering.

The automaker said on Wednesday that it wired $451.8 million to repay the full loan with interest.

"I would like to thank the Department of Energy and the members of Congress and their staffs that worked hard to create the (Advanced Technology Vehicle Manufacturing) program, and particularly the American taxpayer from whom these funds originate," Tesla Chief Executive Elon Musk said in a statement. "I hope we did you proud."

Republicans have criticized the Obama administration's support of new-technology companies, including struggling automaker Fisker Automotive Inc, as well as electric battery maker A123 Systems and solar panel maker Solyndra. Both A123 and Solyndra filed for bankruptcy.

DOE officials heralded the Tesla payoff in a press release.

"When you're talking about cutting-edge clean energy technologies, not every investment will succeed - but today's repayment is the latest indication that the Energy Department's portfolio of more than 30 loans is delivering big results for the American economy while costing far less than anticipated," U.S. Energy Secretary Ernest Moniz said.

Moniz said more than 90 percent of the loan loss reserve Congress established remains intact, while losses represent about 2 percent of the overall $34 billion portfolio.

DOE first offered loans to Tesla and other automakers in June 2009, when the companies could not arrange financing through public markets during the recession.   Continued...

 
Tesla Chief Executive Office Elon Musk speaks at his company's factory in Fremont, California, June 22, 2012, as the car company began delivering its Model S electric sedan. REUTERS/Noah Berger