Tesla has confirmed it has paid off the entire loan awarded to it by the Department of Energy back in 2010--a full nine years ahead of schedule. The Californian startup wired the remaining $451 million amount yesterday.
The original loan stood at $465 million, though with Tesla’s latest repayment, plus two previous payments made in 2012 and in the first quarter of this year, the government has received the original amount loaned to Tesla [NSDQ:TSLA] plus some interest.
The final loan repayment was made using a portion of the automaker's approximate $1 billion in funds raised during last week’s concurrent offerings of common stock and convertible senior notes.For the first seven years since its founding in 2003, Tesla was funded entirely with private funds, led by co-founder and current CEO Elon Musk.
The DOE loan, provided under the government’s Advanced Technology Vehicle Manufacturing program, was used by Tesla to build two manufacturing facilities: one plant for the award-winning Model S and another for battery, motor and electrical equipment assembly. Both facilities are located in California.
In line with similar mandates applied to other DOE loan beneficiaries, such as Fisker Automotive, Tesla needed to hit certain production milestones to receive the loan funding in full as well as raise matching amounts in private funding. Tesla says repaying the loan early is not only a sign of its success and viability, but it will also help save millions in interest payments.
The latest news comes just weeks after Tesla reported its first profit in the company’s history. Tesla earned a respectable $11 million during the first quarter of 2013.
Tesla is now in the process of ramping up production of its Model S and will soon begin preparations for its next model, the Model X electric crossover.