Ten-year-old electric car company Tesla Motors has announcedÂ that it has paid off the whole loan given to it by the United States Department of Energy, nine years early.
In a statement Tesla said is has wired a final $451.8 million payment, which repays the full loan with interest. It also notes that its the only U.S. car company to have now fully repaid the government. Although ten years old, Tesla has only had the government loan since 2010. The loan required matching funding obtained through an initial public offering.
Tesla was able to pay the loan back in full now because last week, after recently announcing its first ever profitable quarter, the company raised around $1 billion in concurrent offerings of common stock and convertible senior notes. Founder and CEO Elon Musk bought a further $100 million as part of that common stock. As part of the company statement Musk said,
â€œI would like to thank the Department of Energy and the members of Congress and their staffs that worked hard to create the ATVM program, and particularly the American taxpayer from whom these funds originate, I hope we did you proud.â€
This should go a long way to countering previous criticism from conservative politicians, such as Sarah Palin, Mitt Romney and others, that giving a big loan to an emerging electric car company such as Tesla would be a big waste of public money. In fact, the Advanced Technology Vehicle Manufacturing program from which the funding came was signed into law by George W. Bush back in 2008, and then the loan given to Tesla by the Obama Administration later. Both sides of politics can take some credit for helping Tesla become the first thriving electric car company.
Image CC licensed byÂ OnInnovation: Elon Musk, Founder and CEO of Tesla Motors