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Hybrid Cars – Elio To Launch by Mid-2016 With 41,000 Reservations And Counting

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SOURCE: Hyrbrid Cars

The ongoing saga of Elio Motors’ push toward production now projected by mid 2016 took a new step last week with the aspiring automaker’s first-time presence and press conference at the New York International Auto Show.

With 41,000 reservation holders having shelled out $100-$1,000 for the American startup’s economical three-wheeled, front-wheel-drive vehicle, Elio has been likened to an “anti-Tesla” and has many supporters as well as detractors willing to offer opinions on its prospects.

In New York, founder and namesake Paul Elio gave a brief talk April 2 for the media and fielded questions.

Elio Motors has said production deadline for the tandem two-seater – which has been pushed back – as well as funding goals, and mpg estimates are not hard-and-fast, but general ranges.

At the same time it does continue to tout eye-catching statistics like 49 mpg city, 84 mpg highway for $6,800 but these targets the company concedes are not do or die, but they remain, and it will at least be very close if not on the money.

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“I wanted it to be high mileage, and I think our initial target was 75, and then we realized we could do better,” said Paul Elio in January to Jalopnik in a lengthy phone interview. “84 was a stretch target if you will, and we’re very close to hitting it. Right now, I think we’re about 81.4, but we’re continuing to work on the design. So I don’t know that we’ll hit 84, but let’s face it, if we go into production at 81, did we fail? I want to hit it because I said I would. But from a social impact and product value, anywhere in that neighborhood is going to be dandy and I know we’re there.”

Paul Elio has his talking points down, and to his supporters, he’s been called a visionary with a more-practical mission than Tesla chief Elon Musk.

Whatever is the case, while there’s been some ambiguity on how to classify the vehicle, it is officially a motorcycle, he says, or rather, an “autocycle.”

SEE ALSO: The Elio – High Hopes For This Unusual Underdog
This term was explained by Vice President of Sales Jerome Vassallo in an interview with HybridCars.com April 1 at Elio’s modest presentation in the basement of the Javits Center, and Vassallo says proposed legislation would classify the Elio uniquely.

An autocycle is a sub-class of motorcycle that includes three wheels, automotive airbags, automotive controls, and a roll cage – i.e., the reinforced cabin.

Additionally, Vassallo said insurance should be motorcycle cheap while the company strives for maximum safety. Given that the Elio should be safer than a motorcycle, Vassallo said Elio could argue insurance premiums ought to be even less, but it will be content if underwriters at least keep it lower cost than an automobile.

Highest Safety Standards

If you have read reports saying Elio will be granted a “5-star safety rating” from the federal government, Vassallo said Elio has never said exactly that, nor could it because the federal government does not crash test motorcycles. Rather he says it will meet the “highest safety standards.”

Whether the National Highway Transportation Safety Administration chooses to anonymously purchase and crash test the Elio after it’s in production is still up in the air though the request has been made.

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This is potentially even a “political” question, Vasallo said. If NHTSA decides not to crash test the Elio, it will nonetheless be engineered for occupant protection with its automotive-length crumple zone, three airbags – front and side curtain – and if needed, Elio will contract a private firm to crash test the autocycle and provide data.

What safety “standards” it might meet is unclear given that it’s not classified as a car, and there are no crash test standards for a motorcycle, but the gist is the autocycle will be safe, potentially even counter-intuitively so.

The Anti-Tesla?

Paul Elio says the Elio story began after he could take it no more hearing of U.S. trade deficit, money going offshore to feed the oil habit, environmental and related issues, and decided to take matters into his own hands.

It’s been said in ways his bargain-basement priced solution could not be more different than the technologically avante garde approach Tesla is taking with its $75,000-$140,000 Model S and other creations pending.

 

That its objective is at least similar to Tesla Motors is clear however, and both companies contemplate overlapping goals with very different thinking.

Where Elio is different includes, but is not limited to it caters to “poor” people – or those on a budget. Its demographic is those who want a cheap commuter, not an ultimate long-range, gas-eschewing large electric sedan capable of competing with all comers, even in P85D form against a Lamborghini Aventador in stoplight drag races.

Tesla aims to go down market too, but one $35,000-$50,000 Model 3 could buy at least five Elios so Elio is aiming to sell them in bunches like bananas. Tesla’s “gas savings” touted for a Model S is $10,000 over five years.

Vassallo said a buyer would be hard pressed to equip an Elio from its a la carte menu options above $10,000.

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The Elio is also a motorcycle, not a car, and it is a low-tech internal combustion-powered vehicle. Elio is developing its own 900cc naturally aspirated three-cylinder engine modeled on the Suzuki/Geo Metro developed engine used in prototypes. German engineering firm IAV which makes engines for Mercedes, others, and “did the Veyron” engine for Bugatti is doing the work, but this will be produced in-house in Elio’s Shreveport plant.

 

Tesla by contrast constructs proprietary electric drive systems and to date has sold technology to Toyota for its RAV4 EV and Mercedes-Benz for its Smart Electric Drive and B-Class Electric.

Like Tesla, Elio occupies a formerly GM-affiliated facility, in the U.S., and pro-USA Elio says this will create 1,500 jobs and be 95 percent U.S. content. Last week, Elio said the U.S. originated engine from a U.S. startup automaker was recently fired up. This was the first time in 60 years a U.S. automaker had done this, he said.

Unlike Tesla, Elio does use gasoline, just less of it, and the company does tout this benefit potentially from an energy security and environmental standpoint.

“At up to 84 mpg you’ll be passing gas pumps in your Elio all day long. Which also means you’ll be putting far less pollutants in the air than even the most environmentally-friendly cars,” says Elio on its website. “Multiply that times the number of Elios projected to be sold, and America could save almost 5 billion gallons of fuel per year, while reducing harmful CO2 emissions by more than 90 billion pounds.”

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There’ve been questions and loose dealing of facts sloshing around the blogosphere about this car being a motorcycle which has been said not to need to meet emissions regulations, but this is not exactly correct.

Motorcycles sold in the U.S. do need to meet less stringent regulations, and the Elio which is built from all automotive componentry will have a catalytic converter and be developed to relatively efficient automotive standards.

Its design ethos of using lower tech (thus less expensive) parts also means while it will have variable valve lift, 12.5:1 compression yet compatible with regular gas, the 55-horsepower mill won’t have direct injection or other tricks such as a Ford 1.0-liter EcoBoost has.

Estimated performance for its new car is 0-60 in 9.6 seconds, top speed of 107 mph.

Vassallo said amongst all the brainstorming that happens behind the scenes, the proposal of racing Elios has been floated, he thinks it would be a neat idea, but no plans are pending.

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Despite deviating with its own engine and re-engineering parts like the windshield washer bottle, or the hood latch to save $20 per car, Elio is trying to use parts bin engineering where it can. It simultaneously boasts of thinking outside the box but staying safely within a cost-containing box and implies it is working smarter, not harder to deviate from what it describes as major automaker practice which may be careless with production costs.

This is part of the formula for hitting that $6,800 price point which Elio will offer in strip mall-based privately owned stores.

Here too the formula is like Tesla but different in that it’s planning factory stores with no pressure, no haggling. Where it differs from Tesla is that its real estate will not be as premo as Tesla’s which plants itself in high-floor traffic districts to attract enough upper socioeconomic folks who can afford the Model S and subsequent planned products.

Rather, Elio offers an inexpensive, novel conveyance that will do the job, and while progressive in its sales approach, it expects buyers to come to it.

Challenges

Elio Motors has inspired quite the following, while simultaneously provoking several writers and other self-appointed guardians of the truth to decry it as a “scam” on a high order, or simply an overoptimistic goal which cannot succeed.

Numerous objections start with the low price and relatively high mpg for a U.S. based manufacturer, considering such facts that imported scooters can cost a few thousand more, and perceived red flags range from there.

Another objection is three wheelers have a checkered history of ever being embraced in America, and that the Elio is a motorcycle in a country checkered with helmet laws and motorcycle licensing laws meaning bottlenecks to sales here and there.

Paul Elio said the autocycle is actually safer without a helmet as a helmet could increase likelihood of injury. Still, some states may require owners be licensed as motorcyclists before they may drive the Elio on their roads.

To this, Elio Motors says motorcycle licensing and helmet laws are a minor issue, it’s lobbying state by state, has had success in reasoning with lawmakers, and Elio says issues will be resolved.

Another sore point for detractors is the fact Elio is building its own engine and not using an off-the-shelf component like it otherwise boasts of as smarter engineering. Elio says when it made the decision to build its own engine, supply was not available from other sources, so this is the road it chose.

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And one other big issue is that life blood of any company – funding.

Vasallo said Elio has a goal of $300 million, a number that’s been reported in the middle $200 million range at other times, and in any event Elio Motors has raised $65 million – mostly from private venture capital funding and one wealthy backer.

Meanwhile, the capital-light business model has become the most successfully crowd-sourced company in history, said Paul Elio, and counting 41,000 reservations it has “pre-sold” $280 million in product. This assumes 100 percent of all reservation holders do not back out though the “all in” reservation holders are obligated with non-refundable deposits.

Elio said also the first year 5,000 reservation holders signed on, the next year 33,000 did. Beyond this, he said he believes 250,000 reservation holders may sign up meaning 100-percent of the plant’s production capacity is accounted for (18:17 in video).

Vasallo said the U.S. Department of Energy’s Advanced Technology Vehicle Manufacturing (AVTM) program re-contacted Elio Motors and offered to let an application made a few years ago be reopened. After negative press and political fallout from loans gone bad to Solyndra, the government had shut the AVTM program down, but it’s again accepting applications.

It’s believed established suppliers are more likely to be approved, but Vassallo said $185 million is potentially waiting in federal tax dollars if AVTM stamps yes on Elio’s request.

For the above objections and more, the company has patiently answered and its website does as well.

Helping Elio’s case is the fact Pep Boys has signed on to service the company’s products, and Elio Motors is making headway which means objectively, the jury is definitely out despite subjective feelings expressed by naysayers, fans or anyone in between.

Hope

Elio Motors fully acknowledges it is selling what others have said is pie in the sky, but it maintains these sky high aspirations of a reliable, safe, American-manufactured car that gets 49 mpg city, 84 mpg highway, and starts at $6,800 is on its way.

Today’s economy and market have witnessed other companies with big ideas floated amidst a sea of naysayers and some are still standing even if they defy traditional accounting fundamentals in some sense.

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Three or four years ago Tesla looked far more shaky than it is, and it has defied odds, so will Elio do so as well from the low end of the spectrum with quite the different alternative?

For its part, Elio is shooting for first deliveries sometime before June 2016. Stay tuned.

 

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