Posted on 09/03/2015 10:00:15 AM PDT by thackney
Electric carmaker Tesla has announced that it will obtain lithium for its batteries from two companies in northern Mexico, leaving Nevada lawmakers who approved major tax incentives for the company frustrated.
In 2014 the Nevada Legislature approved $1.3 billion in tax incentives for Tesla’s Reno gigafactory.
The Las Vegas Sun reports that during legislative debates over the incentive package, there was speculation that Tesla would boost the state’s lithium industry...
(Excerpt) Read more at washingtontimes.com ...
Musk screws Rubes in NV
Who knew
Check if the drug cartels have taken over these Mexican mines.
They are doing such things.
Our ‘loving’ friends.
It was an “investment” LOL
Subsidizing the rich.. Brilliant!!!
Maybe the NV lithium miners thought they could squeeze Tesla for more money, forgetting that there are other competitors out there willing to score a big deal for less money. Elon Musk is a capitalist, not a cronyist.
Exactly. I saw this one a mile away.
Nevada’s lithium likely played in Tesla’s factory decision
http://www.marketwatch.com/story/nevadas-lithium-likely-played-in-teslas-factory-decision-2014-09-04
Sept 5, 2014
Nevada is home to the only operating lithium mine in the U.S., which likely played a part, however small, in Tesla Motors Inc.’s decision to locate its much-talked-about battery factory in the state.
The U.S. still imports most of its lithium, with Australia, Bolivia, and Chile among the top exporters of the mineral. But one Nevada mine has been churning out the stuff since the 1960s, and other lithium deposits in the state could come in line depending on demand.
Lithium is the not-so-secret sauce in the countless rechargeable batteries used in a variety of products, including the battery packs that power Teslas.
Tesla is likely to be “a very large consumer” of lithium, and will likely need to find new sources of the metal, said Carl Nesbitt, an associate professor of metallurgy at the University of Nevada, Reno. From a purely technical standpoint, it would make sense for Tesla to be near a lithium source such as the mine in Silver Lake, Nev. he added. The mine is about 250 miles southeast of Reno, near Tonopah, Nev.
Most lithium is refined in China, which ships the resulting lithium carbonate to all the corners of the world.
Tesla will likely stick with China as its main source of refined lithium, at least for the time being. After a considerable investment and depending on volume, some of the lithium could be processed in the U.S., Nesbitt said.
The many companies run by Elon Musk are excellent case studies in cronyism. Recently, members of Congress have raised concerns about the lack of oversight into SpaceX’s, Musk’s space exploration company, regarding a launch failure it suffered in late June. However, SpaceX’s use of government funding, subsidies and tax credits is the big scandal. A June article by Los Angeles Times, “Elon Musk’s growing empire is fueled by $4.9 billion in government subsidies,” provided evidence that the government is loading up Musk’s three companies, SpaceX, Tesla and SolarCity, with taxpayer-backed subsidies. This is not fair to Americans who are hurting right now that they are being used to pad the pockets of a guy who is already super rich—yet his companies would be belly up without massive infusions of money from taxpayers.
The Times reported “Tesla and SolarCity continue to report net losses after a decade in business, but the stocks of both companies have soared on their potential; Musk’s stake in the firms alone is worth about $10 billion.” Of course the stock is soaring, because the government has subsidized the billionaire’s companies with even more billions. Investors know the government is insuring that money will flow into a crony’s company and that makes it a good bet. SolarCity has been the beneficiary of $750 million from the New York taxpayers to build a solar panel factory in and has secured a lease for $1 a year with no property taxes. The federal government has provided direct grants of about $500 million. Solar analyst Travis Hoium had this to say about SolarCity: “Simply put, the company wouldn’t exist in the form in which we now know it without the government funding.”
Tesla motor company has secured $1.3 billion in incentives to help build a battery plant in Nevada. USA Today reported that the Tesla $127,000 deluxe electrical performance sedans were undrivable because of a tech glitch. The government is subsidizing the manufacture of cars that would cost the average American about two and one half years to buy. The cars are very expensive and they don’t seem to work well. I would not invest in this company, yet it seems that the Obama Administration has already made that decision for me when they gave them $452 billion as part of the Stimulus plan.
SpaceX company has been awarded billions of dollars in government contracts with much of the work yet to be completed. For example, the SpaceX rocket that recently exploded was being launched in an attempt to deliver cargo to the International Space Station as part of a $1.6 billion contract. While Congress has questioned the technical investigation into the failure, SpaceX continues to compete for government contracts.
There have been multiple articles recently on SpaceX purchasing $165 million of SolarCity bonds. Elon Musk owns more than 20 million shares, which is 20 percent of SolarCity. Musk will personally benefit substantially if the SpaceX purchase brings other investors to SolarCity.
It is unusual for a company to utilize cash to invest in the debt of a higher risk company, because it is not a good business decision. It may be good for one man, Musk, but it is not a smart investment for everybody else. In June 2014, the NASA Office of Inspector General found that SpaceX could not identify the costs incurred and was not able to separate the amounts billed and collected for Space Act Agreement contracts. These are the very same type of contract NASA issued to SpaceX to launch cargo to the International Space Station.
A grand total of $4.9 billion in government money has been entrusted to Elon Musk from the taxpayers. Let’s hope that the government does not throw more good money after the bad and continue to prop up Musk’s companies that are not making any money.
Elon Musk is a capitalist, not a cronyistMost capitalists eventually make profit from their businesses.
"Cronyists" leach off of taxpayers.
Ignorance is bliss.
If he is building in Nevada, and lithium is available in Nevada, it stands to reason he may ultimately buy some of his lithium from them. The article doesn’t discuss the quantities he needs and the production capacity of the local mine. Or their refining capabilities. There is probably more to the story.
Without a price comparison, there is little to reason out such a conclusion.
HA!!
I figure most Dims are taking Lithium.
Vegas-backed blowhards... debating about how to allocate money that they didn't earn and care little about... make some uneducated guesses about how the deal might benefit themselves and the state... and cry like little girls when it doesn't happen. Gotchya.
Short version: a majority of US legislators enacted tax laws promoting development of solar power, electric cars, and space travel; a capitalist is capitalizing on the method of this promotion - and for some reason people are surprised.
Unlike Solyndra et al who pocketed taxpayer money and disappeared, Musk is actually building viable businesses via this capitalization process.
The article you quoted is a straight-up hit piece. “the Tesla $127,000 deluxe electrical performance sedans were undrivable because of a tech glitch”? you think that glitch wasn’t fixed in short order? “The cars are very expensive and they don’t seem to work well”? the prices are plummeting toward a normal $30k/car, and of late scored 103 out of 100 points on Consumer Report’s car ratings. Yes, the government has dropped billions into Musk’s companies - exactly the way the subsidies were implemented; Musk himself has also poured billions of his own dollars (he made a boatload of money creating & selling PayPal) into them as well.
We may agree that the government shouldn’t be funding such ventures. We should also agree that a capitalist making use of those funds in a successful manner is appropriate. We should also agree that there is a difference between a capitalist leveraging opportunities to build a business is NOT the same as legislators creating ways to funnel boatloads of money into their friends’ pockets.
Government invests billions in speculative companies to make sure they make a profit? Really? Maybe I'm wrong, but in new tech ventures like Tesla, the investments are to help develop the technology, whether profits are made or not. Our interest is in helping the technology to take the next step, not in making sure individual owners make certain amounts of money.
More likely stands to reason local lithium miners will realize they can’t compete on a global market when acting like they’re his only source - they aren’t. If they don’t lower their prices soon (and adjust production costs to accommodate it) they’ll find a whole lotta money going not into their pockets, and as cheap world lithium supply dries up Musk will switch technologies accordingly - leaving them with lots of product they _could_ have sold at great profit but didn’t, and then cannot sell.
Remember: we live in a world where it’s cheaper to ship fresh-slaughtered meat (highly perishable, heavy weight) to China for processing and shipment back here. Local lithium producers better get their costs under control ASAP.
Indeed. Remember, Musk is throwing billions of HIS OWN dollars at these ventures too. He has a great deal to lose if these don't pan out. Naysayers overlook this.
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