Taxpayer Millions, Lithium Ion and Rich People Just Don't Mix Well
Undoubtedly alternative energy and transportation innovator Elon Musk – like his competitor for the taxpayer-funded, six-figure electric automobile market Henrik Fisker – is a smart guy. But will economic and technological realities humble him, or worse, make him look like a fool?
After the experience recounted last week by New York Times journalist John Broder, who test drove the Tesla Model S in frigid conditions that required frequent unplanned recharging stops throughout the Northeast, humility is out of the question for Musk. The jury is still out on inanity.
The Times published Broder’s devastating account on Friday. The plan was for the reporter to set out from the Washington, D.C. area and examine the claims that the Model S battery has a 300-mile range on a full charge, utilizing the carefully spaced new superchargers located at rest areas in Newark, Del. and Milford, Conn. – approximately 200 miles apart. Broder explained that the 480-volt superchargers (other companies amusingly call them “fast chargers”) require 30 minutes of juicing to provide 150 miles of range, with an hour needed to fully charge the EV.
The first leg of the trip, from D.C. to the Delaware station, was uneventful, according to Broder. However the recharging process doesn’t sound like it went as promoted, requiring 50 minutes to fully power the half-drained lithium ion battery.
From there it was all-downhill, and not in the gliding “wheeee!” sense of the term. Rather, Broder noticed a dramatic, sudden drop on the battery indicator, and realized he would need to preserve his power by turning off cabin heat (outside temperatures were in the 30s) and slow down to 54 miles-per-hour, realizing that making it to Milford would be dicey. Range anxiety set in.
“All the while,” Broder wrote, “my feet were freezing and my knuckles were turning white.”
The remainder of his experience (it must be read to be believed) only got worse. Suffice it to say it was filled with fits, starts, warning signals, an overnight loss in 10-degree Connecticut weather of 65 miles of range, unplanned hours of slower-than-expected travel, and ultimately a tow-away.
“Fortunately,” Broder observed, “the cab of the tow truck was toasty.”
Following his report, Tesla’s stock price promptly plummeted. According to Bloomberg shares declined up to 4.4 percent – “the biggest intraday drop since Dec. 13” – before recovering slightly. That sent Musk into emergency Twitter mode on Monday, looking to mitigate the damage. In consecutive posts, he wrote:
“NYTimes article about Tesla range in cold is fake. Vehicle logs tell true story that he didn't actually charge to max & took a long detour.”
“Tesla blog coming soon detailing what actually happened on Broder’s NYTimes ‘range test.’ Also lining up other journalists to do same drive.”
What’s that about picking fights with those who buy ink by the barrel (or pixels by the peck)? Shortly afterward Musk moderated his tone a bit, byposting, “Am not against NYTimes in general. They’re usually fair & their own prev(ious) Tesla test drive got 300+ miles of range!”
Still, calling a New York Times reporter’s work “fake” (unless you’re a conservative, which Musk is NOT) does not sound conciliatory to someone who is otherwise sympathetic. Instead it conjures images of Jayson Blair, which will not get the Gray Lady on your good side.
And that’s pretty much what Musk did in an interview with CNBC on Monday. He characterized the article as “something of a setup,” and accused Broder of taking a detour through Manhattan after not starting his trip fully charged. But according to Broder, the Model S was delivered to him by a Tesla representative and the vehicle was fully charged, which got him to Delaware. Only afterward while passing through New Jersey did he begin to recognize dramatic power loss, according to his report. So either Broder is telling the truth, or he’s been possessed by the Blair demon.
Right or wrong, Musk’s approach without working out what happened with Broder is risky and puts his company’s credibility on the line. It is also reminiscent of Fisker’s tactic last May, when a fire was caused by one of their extended-range electric Karmas, which led to extensive damage to the home of a Texas owner. Afterward Fisker suggested “possible fraud or malicious intent” was involved, which the customer did not appreciate. After another fire, in California last August, Fisker struck a similar tone that emphasized the fact that no one was hurt, rather than show concern for the losses of the Karma owner.
“No injuries were reported; the vehicle was parked; and the fire was extinguished safely by the emergency services,” a company statement said, dryly.
At least the Tesla Model S didn’t catch fire. But Musk’s reaction nonetheless exhibits a bit of hubris, which is especially distasteful from a man who asked for, and received, a $465 million loan guarantee from U.S. taxpayers to help build his $101,000 toy electric car for rich people.
For all his smarts, Musk actually is pretty dependent on the government dime. He is best known as co-founder of the company that became PayPal, and is now chairman of SolarCity and CEO of Tesla and SpaceX, the private space flight company. According to the Center for Responsive Politics, SolarCity spent $535,000 in 2009 and 2010 to lobby Congress and the Department of Energy on climate legislation, the Recovery Act, “green workforce training and development,” and provisions in various legislation “relevant to solar development.” SolarCity also sought to extend a program that delivered to manufacturers an upfront cash grant in lieu of a 30 percent Investment Tax Credit (called the Section 1603 grant program). Through the middle of last year, according to DOE reports, SolarCity had received more than $66 million from that program.
The company also won a partial guarantee from DOE of a $344 million loan that would place up to 160,000 rooftop solar installations on military housing across the country.
Similarly, Musk’s Tesla Motors spent $480,000 from 2007 to 2011 to lobby Congress, the White House, EPA and DOE on climate and energy issues, the Advanced Technology Vehicles Manufacturing loan program, the Promoting Electric Vehicles Act, and the Recovery Act. That was rewarded with the $465 million loan.
Speaking of audacity, while taxpayers ponied up to subsidize Musk’s schemes and dreams, late last year he bought a mansion in ritzy Bel Air, Calif., for $17 million. According to the Wall Street Journal, “the 20,248-square-foot home has six bedrooms, nine bathrooms, five fireplaces, a wine cellar that holds 1,000 bottles of wine and a two-story library. The property overlooks Bel-Air Country Club and includes a lighted tennis court, five garages, a pool and spa, gym and guest quarters.”
And most recently, earlier this month, Musk felt so good about himself that he intruded into Boeing’s business by offering help with the disastrous Dreamliner shutdown. Calling Boeing’s lithium ion battery packs “inherently unsafe,” he boasted that neither Tesla or SpaceX ever had fires, despite “fly(ing) high-capacity lithium-ion battery packs in our rockets and spacecraft, which are subject to much higher loads than commercial aircraft and have to function all the way from sea level air pressure to vacuum.”
Musk might be right. He might even be able to help. But he also needs the taxpayers’ help, obviously, and the media’s. The arrogant attitude and cavalier flaunting of his personal riches, while acting desensitized to those he needs, will wear thin quickly. He’s yet another character the government gives millions to that makes you shake your head.
Paul Chesser is an associate fellow for the National Legal and Policy Center and publishes CarolinaPlottHound.com, an aggregator of North Carolina news.
[First published at the National Legal and Policy Center.]