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Tesla Enthusiasm for Battery Swap Wanes After Subsidies Disappear
NLPC ^ | June 30, 2014 | Paul Chesser

Posted on 06/30/2014 10:31:19 AM PDT by jazusamo

Elon Musk IronMan

NLPC has extensively documented howTesla Motors has taken advantage of market distortions to reap revenues – including government mandates, subsidies, and taxpayer support – not the least of which have been so-called “zero emission credits” from the state of California. But much of the revenue Tesla enjoyed last year – which often meant the difference between profit and loss – was credited based upon theoreticaltechnological capabilities and not ones actually put into practice.

CEO Elon Musk has also relied on accounting gimmicks to enhance his bottom line over the last 18 months, during which a couple of quarterly earnings reports even showed a profit – albeit under non-Generally Accepted Accounting Principles. Those handsome returns were achieved in part thanks to a scheme administered under the California Air Resources Board in which additional zero emission credits are awarded to vehicle manufacturers based upon the ability for models to “fast fuel.” In the case of Tesla and other electric vehicle makers, the faster a car can recharge to the point it can drive a longer distance, the more credits it receives.

As automotive Web site Jalopnik explained, Tesla’s Model S could “refuel to 285 miles with full pack in under 15 minutes,” which would entitle the company to seven ZEV credits per vehicle. The credits are then sold to automakers that don’t produce enough vehicles to meet the Golden State’s clean emissions mandates. CARB awarded Tesla five credits based upon its Supercharger repowering technology and two credits thanks to its capability to “fast-swap” batteries.

That’s where the revenues based upon the hypothetical come in. Despite having received millions of dollars thanks to CARB’s recognition of battery swapping as a contributor to reaching the “zero-emissions” milestone, Tesla never actually employed the practice. In fact, the company earned credit for battery swap several months before they even showed it was possible!

“CARB gave Tesla these extra credits before any battery swap station had been built,” wrote researcher Alberto Zaragoza Comendador for the respected climate skeptic Web site Watts Up With That. “In fact, it happened about nine months before the feature was publicly demonstrated (June 2013).”

And a one-time demonstration is apparently all Tesla has shown the public. Existing owners of the Model S are skeptical, and barely any mention of swapping stations appeared in SEC filings. Yet according to Comendador’s analysis, Tesla had the potential to reach $60 million in 2013 thanks to the battery swap scheme, with the possibility of an additional $30 million.

Alas, CARB changed its criteria for ZEV credits to eliminate allowances for the battery swaps. But automotive Web sites haven’t let Tesla off the hook over its plans. When Jalopnik inquired, they were told that there was a “reprioritization.” And when the Web site asked how much each of the battery swap facilities were expected to cost, Vice President of Corporate Development Diarmuid O'Connell said, “I want to talk about that even less.”

Torque News was even more blunt, in a blog post last week that explained “why Tesla doesn’t really care about battery swapping.” As with everything in business, it boils down to economics.

“At present it is simply too difficult and expensive to deploy battery swapping on a large scale,” wrote Torque’s Luke Ottaway. “For one thing, the swap stations will cost a great deal more than your typical Supercharger that already runs up to $300,000. Automation is the most likely solution for battery swap stations, and the machinery required to handle heavy battery packs and make delicate connections would not come cheap. Companies simply don’t have the capital to roll out significant numbers of these stations.”

Which explains why Tesla never built any in the first place, and ran a dog-and-pony show in June 2013 to exhibit a battery swap for public consumption, and then barely mentioned it again. Meanwhile the State of California let them get away with millions of dollars on the phony premise that less pollution was being emitted as a result. Now that there’s no longer an economic incentive, it looks like Tesla is trying to let the idea die a quiet death.

Comendador called it “the hoax of the year.” If it wasn’t for the overall global warming ruse that schemes like electric vehicles were supposed to fix, he might have been right.

TOPICS: Business/Economy; Crime/Corruption; Government; News/Current Events; US: California
KEYWORDS: battery; batteryswap; california; efv; elonmusk; energy; scam; subsidies; tesla; zeroemissioncredits

1 posted on 06/30/2014 10:31:19 AM PDT by jazusamo
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To: jazusamo
There's a Tesla “dealership” located in a mall near me that I visit very frequently (it's a great place to “power walk”).Most of the times I've passed by it there hasn't been a *single* customer to be seen (people inside are easily spotted from outside).Occasionally I see one or two customers and once I saw about a half dozen people inside.I think Tesla is just one huge scam by a disciple of algore himself.
2 posted on 06/30/2014 10:42:35 AM PDT by Gay State Conservative (Rat Party Policy:Lie,Deny,Refuse To Comply)
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To: jazusamo

They love OPM

3 posted on 06/30/2014 10:44:28 AM PDT by GeronL (Vote for Conservatives not for Republicans)
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To: Gay State Conservative

I think your observation is excellent, as other subsidies dry up so will Tesla motors, in my view.

4 posted on 06/30/2014 10:48:49 AM PDT by jazusamo (Sometimes I think that this is an era when sanity has become controversial: Thomas Sowell)
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To: jazusamo

Back to the pneumatic tube for shooting people between LA and San Fran.

5 posted on 06/30/2014 10:49:57 AM PDT by MUDDOG
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To: jazusamo

I bet the guys on Fast and Loud, for example, could design and build a swap out machine for 100K or so.

Then some entrepreneur gas station around Victorville along the I-15 between Vegas and LA would install one and advertise. The publicity would be worth it. Plus he could install solar for recharge.

Let the market work it out.

6 posted on 06/30/2014 10:51:04 AM PDT by cicero2k
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To: jazusamo

Tesla and many other businesses are an intentional result of marketplace distortions created by legislators. The legislators know that any reduction in subsidy results in a 1-for-1 reduction in profit to the created company. At some point, the profit is too small, and the business operator shuts down the operation. Meanwhile, the business has the subsidy as profit.

7 posted on 06/30/2014 10:54:04 AM PDT by Cboldt
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To: cicero2k
Let the market work it out.

Amen...The government should get out of picking winners through subsidies for all types of alternative energy.

8 posted on 06/30/2014 10:54:32 AM PDT by jazusamo (Sometimes I think that this is an era when sanity has become controversial: Thomas Sowell)
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To: Cboldt

Well said and Musk is covering all the angles at the expense of taxpayers.

9 posted on 06/30/2014 10:56:26 AM PDT by jazusamo (Sometimes I think that this is an era when sanity has become controversial: Thomas Sowell)
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To: jazusamo
The subsidies collected on the basis of fraud should be clawed back. If that sinks Tesla's boat, it is a perfectly fair consequence. Ditto for the rest of the green fraud brigade.
10 posted on 06/30/2014 11:04:29 AM PDT by Myrddin
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To: jazusamo

as subsidies dry up so will Tesla motors and other Government scams.

11 posted on 06/30/2014 11:06:42 AM PDT by george76 (Ward Churchill : Fake Indian, Fake Scholarship, and Fake Art)
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To: jazusamo

I made the following post almost exactly a year ago on FR when the ObamoFascistMedia exploded with enthusiasm when Musk announced his amazing batter swap stations that were going to sweep the nation:

” Drivers who opt for the swap will have to eventually return to the station to get their original battery back, and they’ll have to pay for the service once again.

If they don’t return, they can pay to have the 1,000-pound battery shipped back to the service center nearest their home, or they can keep the new battery they’ve had installed”


So, in other words, this whole cockamamie battery-swapping scheme is nothing but a sick joke and a ridiculous publicity stunt.

At a half mil per station, I can only assume that Elon is expecting uncle sugar daddy Obama to “loan” him the money to build the stations.

12 posted on 06/30/2014 5:23:43 PM PDT by catnipman (Cat Nipman: Vote Republican in 2012 and only be called racist one more time!)
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To: catnipman

Agreed, and the scam artist has already cashed in on the “zero-emission-credits” from CA by selling them off when it looks as though his proposed battery change out program was a scam to begin with.

He should be required to pay back every dime he profited from the scam.

13 posted on 06/30/2014 5:40:34 PM PDT by jazusamo (Sometimes I think that this is an era when sanity has become controversial: Thomas Sowell)
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