Impressive milestones that suggest this car is making progress towards actually achieve government approval.
1. The engine exists. It is not a Suzuki/Metro Geo engine, but a new engine built and designed by Elio.
2. The crash tests have support of Altair Engineering for simulation including passenger crash simulation.
3. In October, they passed the first of three stages of the ATVM government auto loan program. This loan program has been on hiatus for over two years since Fisker and Solyndra’s failed startups caused a difficult crisis in both government and technology startup’s reputation. The government’s cautious approval of the first stage of loan approval suggests they are looking for lower risk projects that use existing technologies (ICEs), or are are possibly using Elio solely to improve their own populist image without any further approval, but it is doubtful they would be that cynical. Plus, there could be a return in it for them. That said, $184 million is a lot of money to request, and lots of industry engineers would have to thoroughly test the vehicle for final approval.
4. They have outsourced their investing to an investing firm. This may be the era of Kickstarter and Indiegogo, but a project this large is still going to need conventional investors with deep pockets. Their reservation website is a way to possibly raise a few million dollars, but unless 40,000 reservations balloons to 1.8 million at $100, it is still far short of what’s needed. The only time that happened on such a large scale was probably the 2011 election for Barack Obama (it recommended a donation of $2.30, achieving one of the largest number of unique donors.
“Obama had raised only 22 percent of his $96.7 million in 2007 from donors whose contributions aggregated to $200 or less, the CFI study found. That number shot to 48 percent in 2011.”
Still, I remember the 2008 election as the first major shift when small-donors contributed to a national party candidate compared to lower turnout and conventional funders (middle class and up?) 2004 <5% small donation for Kerry, 22% in 2008 for Obama, and 48% in 2011. Crowdfunding has clearly been a major shift in the past decade for all sorts of organizational financing.
5. It has a lot of resistance in the traditional auto market. “First they ignore you, then they laugh at you, then they fight you, then you win.” Jalopnik, a casual, but respected internet car magazine, is doubtful of Elio’s prospects, but it may be hard to see the big picture without extensive research. I’m convinced it will join the long list of status symbols and change the face of American culture forever. I feel like the economy of the post-war era may never return and this car speaks to the new generation of millenials and beyond. A car within the budget of every minimum wage worker who needs nothing more than a way to get to work in a reasonable time.
6. Lastly, realistic carmakers are concerned about safety. They are rational actors, like the Aptera was (their website had very similar criteria listed on their website). Unfortunately, the Aptera still was an expensive car- $25,000-$30000, even considering the government rebates. Electric technology still isn’t as mature as it needs to be, and for that reason, Aptera cannot exist without mass adoption at the sub $15000 sticker price, and if that were to be ready today it would make Aptera profitable but cause brownouts across the U.S. Gasoline, however bad for the environment is unlikely to change gloves, but if not the fuel, the behavior and efficiency of the car can reduce dependency on cars that typically run 80% empty passenger wise.
“6. ‘It’s Not Actually A Car. ‘
Cars have wheels. This has three of them. Three is the minimum. You can call it a trike, but it has an interior like a car.
5. ‘It’s Not Actually Any Better For The Environment.’
It uses less gas, but the answer you’re looking for is biofuel, which it could be capable of as a drop in replacement. But that’s not something Jalopnik researches often, unlike Autoblog.
4. ‘They Don’t Have A Running Engine For It Yet. ‘
They do now.
3. ‘They Don’t Have Enough Money.’
They’re working on that- they now have an investment firm working for them, and 8 days after this Jalopnik article was written, they passed phase 1 of 3 ATVM funding.
2. ‘The Company Doesn’t Know Who Its Audience Is.’
Distance commuters are the main audience and would benefit the most. All other uses would be luxury, recreation, etc.
1. ‘It’s Too Much Of A Compromise.’
Many people in harder economic situations are readily willing compromise a lot in exchange for hard savings. But maybe you haven’t experienced a major, necessary compromise before.
It’s possible that frequent failures in startups is going to cause a skeptical blogger, but the analyses used here can’t be compared equally when people who describe what a car should offer is not what other people are willing to accept- namely engineers, who also represent the common driver. Here is another article being pessimistic about the Elio:
“(1) ‘The DoE’s ATVM low-interest loan program became a huge political issue in the 2012 presidential elections, due to the default of Fisker Automotive.
While Tesla repaid its loans in full, and Ford and Nissan are paying on time, the loss of more than $100 million on a loan to startup Fisker isn’t likely one the department wants to risk again.’
So what? Fisker was a sportscar. Most people don’t drive sportscar and it was a mistake for the government to fund an inefficient and uneconomical car. Lesson learned. Solyndra was a solar panel maker outmatched by dozens of Chinese competitors. The same is not the case for budget, efficient cars in the United States- it is a niche occupied by cars like the Smart and Yaris, but the main reason for buying small cars is the parking space advantage in cities, not the mileage. The Yaris costs $14000 and gets 40mpg- that’s twice the cost at half the mileage.
(2) ‘The last U.S. car company founded from scratch by entrepreneurs whose brand is still with us (discounting Tesla) was Chrysler, and that was in Dec 1924.
No one has succeeded since, including Henry J. Kaiser, one of the greatest 20th-century industrialists. Jury’s still out on Tesla; it could be the first to succeed in 80+ years.’
So there has been one car maker in recent years (Tesla) who is not yet bankrupt. What’s stopping another from joining him? Henry Ford didn’t invent the car; he just made the assembly line part of the economics. The same can be said here. Apple and Microsoft didn’t invent computers and software; they just made it affordable for millions of college students. Planning a Spring break to Colorado? Carpool in pairs… That doesn’t sound so efficient, right? But most of you fly instead of road trips…Jet fuel is expensive.
(3) ‘No one has sold a three-wheeler car in any kind of numbers in the U.S. since before World War 2.’
Exlcluding or including motorcyles? They are a popular option across the U.S. but most people aren’t going to buy one unless they have the typical car amenities- like rain protection. The Elio fits that niche-, quite shrewdly.
(4) ‘The low-priced car market is brutally competitive, and in North America, those cars may be used as loss leaders–or at best break even–by most global carmakers.
But they know how to squeeze out costs, and’
That’s all that’s needed. Squeezing out costs, like Aldi. I’m led to think that there would be a growing market in a bad economy, and stable market in an average economy. The Elio is not exciting for the average person because average people are not exciting.
(5) ‘Ultra-high fuel economy saves you very little extra money compared to pretty-good fuel economy because MPG is not the same as consumption (measured in gallons per 100 miles).
While it sounds good to go from 33 mpg (in a subcompact) to, say, 65 mpg, you only save 1.5 gallons every 100 miles.’
Where did you get that? How do you figure? And, 65mpg is not 84mpg. This is the only thing I do not have explanation, but I would like to see your long division.
‘The compromises to do that in a non-electrified car–including two seats and a motorcycle license in Elio’s case–will likely turn off much of the potential low-cost buyer crowd.”
Elio Motors 84 mpg 3-wheeler [Image: Elio Motors]
(6) ‘No one has yet driven an Elio on the open road in anything like its production form. The company just produced its first custom-built engine this year.’
The fact that it has an older engine suggests the form is workable. Not that they would use the suzuki engine, but even the suzuki engine would get over 50mpg like the Geo Metro did. That’s still more than 10mpg efficient than a Yaris at half the cost. More likely it would get 60mpg with the aerodynamics. Remanufacturing the suzuki engine would be more expensive because the same raw materials may be harder to come by. When was the last time any car startup produced an engine in 7 years since its company founding? 7 years may be a while, but it is still a giant leap in efficiency compared to improvements in the past 25 years with subcompact cars averaging 22mpg in 1990, to 40 mpg in 2010.
Watching a video of an Elio without the intended engine isn’t exactly unrealistic: https://www.youtube.com/results?search_query=elio
‘Getting a vehicle into production in no more than a year and a half from that point seems … aggressive.
Especially if Elio is still missing 70 percent of its funding.’
The car has been delayed before, but pending no additional obstacles, it’s best to set more ambitious goals so the actual projection is not too far off.
Hope springs eternal, and clearly the auto market–while hugely challenging–remains alluring to those eager to disrupt the status quo, both innovators and buyers.
But as one commenter noted, perhaps the Elio should have been a lightweight electric vehicle.
Oh, and there’s a last reason too.
(7) ‘Google “Liz Carmichael” and “Dale” for the last startup car company that proposed an ultra-efficient three-wheeled vehicle.”‘
Just because an eccentric transgender conartist founded an auto company during the 1970s crisis, that makes today’s oil prices and “concept cars” any less real?