Surprise: GM & FCA Agree To Buy Tesla EV Credits

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Thread: Surprise: GM & FCA Agree To Buy Tesla EV Credits

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    News Contributor Premium Member Perian's Avatar
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    Surprise: GM & FCA Agree To Buy Tesla EV Credits

    Bloomberg.com
    June 3, 2019


    For years, Tesla Inc. has hauled in revenue by selling credits to other carmakers that needed to offset sales of polluting vehicles to U.S. consumers.

    These sorts of transactions have largely been shrouded in secrecy -- until now.

    General Motors Co. and Fiat Chrysler Automobiles NV disclosed to the state of Delaware earlier this year that they reached agreements to buy federal greenhouse gas credits from Tesla. While the filings are light on detail, they haven’t been reported on previously. They also represent the first acknowledgments from carmakers that they’re turning to Tesla for help to comply with intensifying U.S. environmental regulations.

    The deal with GM will come as a surprise to those who thought years of sales of plug-in hybrid Chevrolet Volts and all-electric Chevy Bolts would leave the largest U.S. automaker in the clear with regard to regulatory compliance. But while sales of those models have put GM in a position where it doesn’t need extra credits today, demand for its battery-powered vehicles are dwarfed by its gas-guzzling trucks and SUVs. And the company wants to bank the credits for future years when emissions rules get tougher -- especially if a Democrat beats President Donald Trump in 2020.








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    Re: Surprise: GM & FCA Agree To Buy Tesla EV Credits

    And the company wants to bank the credits for future years when emissions rules get tougher -- especially if a Democrat beats President Donald Trump in 2020.
    Imagine the "lack of respect" GM and Ford probably have for our current President at this moment, and yet they apparently need him to win again in 2020. The Tesla agreement is quite a surprise. I wonder what Ford is doing?







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    Re: Surprise: GM & FCA Agree To Buy Tesla EV Credits

    Quote Originally Posted by Perian View Post
    Bloomberg.com
    June 3, 2019










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    I bet FCA bought more than GM and it wasn't close
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    Re: Surprise: GM & FCA Agree To Buy Tesla EV Credits

    It was fairly widely reported FCA purchased 2B worth of credits for EU compliance. I think GM is probably buying far less and mainly banking them in case Trump is not re-elected.

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    Re: Surprise: GM & FCA Agree To Buy Tesla EV Credits

    Basing such a yooj fraud on a fake "crisis" such as CO2 emissions should send thousands to prison. Or back to third grade where they can learn their errors in thinking.

    Tesla (TSLA) is going to get up to $2 billion from Fiat-Chrysler to meet emission standards
    Fred Lambert May. 7th 2019 12:42 pm [email protected]

    We recently learned that Tesla and Fiat-Chrysler (FCA) reached a deal to pool their fleet together in Europe for the purpose of the latter avoiding emission requirement fines.

    It was first reported to be worth a few hundred million dollars, but FCA now says that it will pay Tesla up to $2 billion for the emission credits.


    The European Commission is putting in place an average CO2 emissions requirement of 95g per kilometer in automakers’ fleets next year.

    It means that, on average, the vehicles sold by an automaker throughout the year needs to be no more than 95g per kilometer or they expose themselves to significant fines.

    Of course, adding zero-emission vehicles, like all-electric vehicles, to the mix, can help bring the average down significantly, but Fiat Chrysler is seen as a lagger in the industry when it comes to bringing all-electric vehicles to market.

    Like with the ZEV mandate in California, where automakers falling behind in electric vehicle sales can purchase credits from other automakers with a surplus, the EU allows automakers to pool their fleet together to avoid the fines.

    Last month, Financial Times disclosed that FCA has made such a deal with Tesla worth “hundreds of millions of euros”, but the publication is now reporting that FCA will actually pay Tesla close to €2 billion ($2.3 billion USD):

    “Fiat Chrysler Automobiles has said it will pay electric carmaker Tesla close to €2bn to help it meet tough new emissions targets and has reported a 29 per cent drop in first-quarter profits.”

    FCA would especially need Tesla next year, but it plans to have its own electric vehicles in 2021 to drastically reduce the need to pool its fleet with Tesla, and it plans to be completely independent by 2022.

    Electrek’s Take
    Well, that escalated quickly. It went from a few hundred million dollars to a few billion dollars and it sounds like most of the money is going to come as soon as next year.

    Tesla’s sales of emission credits have been extremely useful to help boost its financials over the years, but the impact has been somewhat limited by the availability of the credits and only a few markets implementing them.

    This new deal with FCA is likely to have an even greater impact on Tesla’s financial and help the company accelerate some of its projects.

    It also shows that regulations work. It will end up both helping Tesla and forcing FCA, which is taking its sweet time to release all-electric vehicles, to deploy EVs faster since I’m sure they don’t like giving up billions of dollars to a competitor.


    https://electrek.co/2019/05/07/tesla...ion-standards/
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    It's a strange world where something made up by the government can have such a high value. 2 billion for some space bucks

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    Re: Surprise: GM & FCA Agree To Buy Tesla EV Credits

    You would have thought that it would have been cheaper for GM to put their voltec platform into some new CUV's to be ahead of the regulation curve. Nahhhhh...............

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    Re: Surprise: GM & FCA Agree To Buy Tesla EV Credits

    Quote Originally Posted by jzchev28 View Post
    It's a strange world where something made up by the government can have such a high value. 2 billion for some space bucks
    As long as GM can use the "Space Bucks" to their and ultimately the customers advantage...It's a WIN WIN WIN!

    I just may go out and get a Model 3 to support GM's need for space buck credits!
    Last edited by Mr.Buttons; 06-03-2019 at 01:30 PM.

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    Re: Surprise: GM & FCA Agree To Buy Tesla EV Credits

    Quote Originally Posted by jzchev28 View Post
    It's a strange world where something made up by the government can have such a high value. 2 billion for some space bucks
    Maybe SpaceX ought to have to buy some credits too. I imagine it creates a great deal of CO2 to produce enough rocket fuel to launch a rocket.

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    Re: Surprise: GM & FCA Agree To Buy Tesla EV Credits

    Get 'em now before Tesla goes BK...
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    Re: Surprise: GM & FCA Agree To Buy Tesla EV Credits

    Quote Originally Posted by eaton53 View Post
    Get 'em now before Tesla goes BK...
    I don't see Tesla going BK, unlike other failed startups, they have a crap ton of $$$ on the backend, plus an overseas footprint. At worst, they'll get scooped up by ToyoHonda, but outright BK...nah.
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    Re: Surprise: GM & FCA Agree To Buy Tesla EV Credits

    FCA is way behind Ford and GM on CAFE credits. I dug this up a few months back from this site.

    Manufacturer...........Fleet ..2011..........2012...........2013............201 4...........2015...2016..............Balance
    FIAT CHRYSLER.......LT.......0................1,173,051 ...0..................0...............0........(35 ,512,568)..(34,339,517)
    FORD.....................LT.......5,812,359...701, 227.......3,699,786......0...............0........ (14,649,401)...(4,436,029)
    GENERAL MOTORS...LT.......4,181,275...0................2,6 48,631......10,481,490.0........(23,022,335)...(5, 710,939)

    This is only Light Trucks.

    It takes NHTSA nearly a year to tabulate all the data and determine the final results. OEMs can carry credits forward 5 years and back 3 years. They can also borrow from the other classes (i.e. cars) and then purchase credits from other OEMs.
    Last edited by TruckMan; 06-03-2019 at 04:12 PM.
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    Re: Surprise: GM & FCA Agree To Buy Tesla EV Credits

    Manufacturer
    Fleet 2012_________2013________2014______2015________201 6_________Balance
    FIAT CHRYSLER
    DP 11,500,000___30,000,000____0_________0__________(2 2,504,989)___18,995,011
    IP 22,812,381___644,178______0_________0___________(3 ,181,056)____20,275,503
    LT 1,173,051____0____________0_________0__________(35 ,512,568)___(34,339,517)
    FORD
    DP 26,139,750___40,611,410___30,152,856___7,089,840__ _(2,931,630)___101,062,226
    IP 1,105,216____0___________0___________0__________(9 0,300)______1,014,916
    LT 701,227_____3,699,786_____0___________0_________(1 4,649,401)___(10,248,388)
    GENERAL MOTORS
    DP 7,246,220____38,987,834____19,402,394__0__________ (16,225,470)___49,410,978
    IP 251,275_____2,780,629______3,646,294___1,304,196__ _(1,553,409)___6,428,985
    LT 0___________2,648,631_____10,481,490__0__________( 23,022,335)___(9,892,214)

    TESLA
    DP 7,164,504____491,723______363,905_____6,792_______ 5,139,096_____13,166,020


    The full fleet numbers don't actually look so bad for Ford and GM. I assume that the 2017 numbers must not be as favorable for GM.
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    Re: Surprise: GM & FCA Agree To Buy Tesla EV Credits

    Quote Originally Posted by sdotjeezy View Post
    I bet FCA bought more than GM and it wasn't close
    I would follow you with heavy money on that one... The Hemis gotta play! And, customers pay the markup. If government stayed out, Tesla would be bankrupt and your typical Hemi would be nearly $10k cheaper. Our politicians are so wonderful. What WOULD we do without them?

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    Re: Surprise: GM & FCA Agree To Buy Tesla EV Credits

    Quote Originally Posted by sdotjeezy View Post
    I don't see Tesla going BK, unlike other failed startups, they have a crap ton of $$$ on the backend, plus an overseas footprint. At worst, they'll get scooped up by ToyoHonda, but outright BK...nah.
    The opposite is true. They are SO OVERVALUED that bk is necessary to put the assets into aware, responsible hands. BK is a lockdown guarantee. No one with a brain will buy them at inflated prices. That $10 share price? Yeah, that's about right. Creditors will wake up. Just watch.

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