I’ve only heard that people who have expired loans will not be punished. Didn’t expect that they will also be punished if they pay off the loan early? Recently, Tesla encountered such a thing. According to reports, Tesla paid a $465 million loan to the U.S. Department of Energy nine years in advance, so the company had to pay an early repayment penalty. Tesla CEO Elon Musk recently posted this on Twitter.
Musk sent Twitter in response to German news, the news pointed out that Tesla will no longer use government subsidies to build its 4680 battery production and recycling facilities in the Berlin Super Factory. This surprised many people because the company’s upcoming battery plant can receive subsidies worth about $1.2 billion.
We learned our lesson with $465M DoE loan received in 2010/2011 – onerous terms exceed value of money received. That’s why we paid it back so early, despite an early repayment penalty.
— Elon Musk (@elonmusk) November 27, 2021
According to Musk, Tesla’s decision in Germany was partly due to lessons learned by the company in the United States. The CEO pointed out that the onerous terms of the loan ultimately exceeded the value Tesla received. Therefore, the company decided to repay the $465 million loan early, even if it had to pay an early repayment penalty. This surprised many people because Tesla was eventually fined, not because it did not pay off the loan, but because it paid off the loan early.
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Many people believe that Tesla’s success and survival now are only because of stable government subsidies. However, Tesla’s most successful quarters, especially recently, were completed with almost no subsidies—at least in the United States.
As the company is not a union employee, Tesla’s electric vehicles cannot even get all the incentives for electric vehicles from the Biden government, but its vehicles like Model Y are still expected to become one of the most successful electric vehicles on the market. The same is true for Tesla’s upcoming models, such as Cybertruck and Semi, both of which may have an impact on the market.