Tesla Motors Inc (NASDAQ:TSLA) could repay its green energy loan from the Department of Energy as early as today. According to a report by Bloomberg’s Angela Greiling Keane, the repayment of that loan will earn at least $12 million—a big win for green energy, which many conservatives have said would fail.
The EV automaker has said since earlier this year that it would repay its loan early. On Tuesday, co-founder and CEO Elon Musk said the company may even pay it back today. Tesla Motors Inc (NASDAQ:TSLA) announced last week that it was raising $1.08 billion in debt so that it could not only pay back the loan, but also build up some cash.
Tesla May Be The Exception To The Rule
Unlike most of the other small companies which received loans from the DOE to develop green technologies, Tesla became profitable during the first quarter of the year. Meanwhile other companies which received the loans, like Fisker Automotive, which has battled bankruptcy, and battery maker A123, which filed for bankruptcy protection late last year, are in the process of defaulting on their loans.
Fisker Automotive and Vehicle Production Group, another company which received a loan, have both stopped producing their vehicles and were unable to make their first payments on their DOE loans. At this point, both companies are in the process of selling off their assets. The DOE managed to mitigate its loss by $26 million by seizing the companies’ reserve accounts, which they had set up in order to receive their loans.
In all, taxpayers could lose as much as $217 million from the loans made to small automakers and other small green energy companies, which means the $12 million earned from Tesla Motors Inc (NASDAQ:TSLA)’s repayment is nowhere near what’s needed to offset the losses.
Tesla Vs. The Large Automakers
At this point it’s mainly the smaller automakers which received the DOE loans and are now descending into bankruptcy. But the amount of cash they received through the loan program was just a fraction of the amount received by companies like Ford Motor Company (NYSE:F), which received $5.9 billion under the program. A regulatory filing dated May 1 indicates that Ford has $5.5 billion left on its loan and is making $148 million payments each quarter.
Nissan Motor Co. also received a $1.4 billion loan under the program. Because the company is based in Japan, it doesn’t file financial statements in the U.S., but it says it’s fulfilling its obligations under the loan.