Tesla Gets $34 Million Tax Break, Adds Capacity For 35,000 More Cars 238
cartechboy writes "The state of California will give Tesla Motors a $34.7 million tax break to expand the company's production capacity for electric cars, state officials announced yesterday. Basically, Tesla won't have to pay sales taxes on new manufacturing equipment worth up to $415 million. The added equipment will help Tesla more than double the number of Model S sedans it builds, as well as assemble more electric powertrains for other car makers. In addition to continued Model S production, Tesla plans to introduce the Model X electric crossover in late 2014, as well as a sub-$40,000 car — tentatively called Model E — that could debut as soon as the 2015 Detroit Auto Show. It turns out California is one of the few states to tax the purchase of manufacturing equipment — but the state grants exemptions for 'clean-tech' companies."
Move to breeder reactors (Score:2)
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That should be FissionX, fusion is a whole different energy source.
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it doesn not matter how the technology works, what the technology is or if the technology works... if it sounds good enough FTB will come after me for a sock i purchased outside the state to give tesla a break.
damn... i sound like a tea bagger lol
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Not that fusion is as far off as people think it is. There are some really promising experiments other than the big ones, that seem single digit years away from usable designs.
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source please, would love to read and keep the hope alive :)
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I believe he's talking about cold fusion, aka LENR (Low Energy Nuclear Reactions), not the hot fusion tech that has gobbled perhaps one trillion dollars worldwide (in today's dollars) since research on hot fusion started in the 1960s.
Considering LENR is considered voodoo science, essentially banned from using govt money in all countries that are large producers of fossil fuels (specially USA, UK, Canada and Australia), I'd say return on investment in LENR research is about one million times better than hot
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Wasn't Rossi the guy who couldn't decide what his invention actually is? At one point its "cold fusion", next it's weak atomic powers", next it's something else.
All of these connected by the fact that his "inventions" appear to be in direct conflict with currently accepted laws of physics. So it's a chance that one guy actually invented something that completely revolutionizes nuclear physics as we know it, as opposed to him being a hack who is after easy money.
Considering that he hails from Milan, has conv
Re:Move to breeder reactors (Score:4, Informative)
I used to be his cheerleader, not anymore.
But I'm still waiting for proof he's a total scam. Also waiting to proof that his product is for real as well.
He did give his reactor a chance to be tested for what 48hrs by some very sharp scientists, the test results were published, they couldn't peek inside, but they could futz around with all external connections all they wanted. No hidden wires found, no weird electrical signal hiding the energy. And the reactor is too small for anything but a nuclear reaction.
Before that test, I was pending back to he's a fraud, now I just don't know.
Fleishman & Poons experiment also appears to be in direct conflict with currently accepted laws of physics, so I my books, it's the laws of physics that need revisiting, and until those can be reconciled, I believe we can't use the laws of physics to rule out the e-cat as a fraud.
In my view, he has one last year to deliver.
I have to warn you that I also see a bunch of very rabid people that probably has some seriously vested interest in the billions being wasted in my opinion on fusion and others employed by the dirty energy lobby that I see your testimony just as questionable as Mr. Rossi's work.
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Like holographic memory? That has been single-digit years away for decades.
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It's not that far off - in only 20 years we'll have fusion power.
Just as it's been for the past 30 years or so.
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Fusion is easy.
Fusion with a decent gain factor is hard.
I thought it was only *controlled* fusion that was hard. Producing energy using fusion [wikipedia.org] was tested and working over 50 years ago.
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Hot fusion research is a scam.
It's not a technical scam, but an economical/publicity scam.
Major governments happily put money on this because they know it's zero threat to fossil fuel interests that are strong in power even in today's green Obama administration. Just look at it from a skeptical standpoint. All clean energies being invested on today are way too expensive. The only solution that would allow us to get rid of 90+% fossil fuels (with electric cars/busses) with proven, already in operation tech i
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This could put an end to tailgating drivers... one way or another...
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And after that, devices to capture ghosts, right?
Thanks, California taxpayers! (Score:5, Informative)
The rest of us are grateful for your generous contributions to our new luxury cars.
Re:Thanks, California taxpayers! (Score:5, Insightful)
Re:Thanks, California taxpayers! (Score:5, Insightful)
Only if Tesla stays in CA after the free money handouts stop and the "pay back to the people who made you rich and successful" part starts. If they up and move their primary manufacturing centers to the next sucker --- oops, I mean, "forward-looking business friendly state" --- to offer them free money/power/impunity once CA's generosity runs out, that mini-Detroit could end up wherever the leader in the national race to the bottom happens to be.
Re:Thanks, California taxpayers! (Score:5, Informative)
Moving a factories costs a fortune. Giving tax breaks in exchange for job creation is standard practice at the state and local levels across the US.
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While corporate welfare handouts are certainly "standard practice," that's not equivalent to "good practice"
Indeed. Tax breaks like this are a classic example of the Prisoner's Dilemma [wikipedia.org]. Everybody does it, but everyone would be better off if nobody did it. Congress should use the commerce clause (legitimately in this case) to ban the practice. Or the courts should ban it as a violation of the Constitution's equal protection clause.
Re:Thanks, California taxpayers! (Score:5, Informative)
The Fremont factory is enormous. They're only using a fraction of it for Model S production, with plans to activate more of it for Model E, etc.
Given that they own a building that exists and will support their needs for the near- to medium-future, it's unlikely that they would move.
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Re:Thanks, California taxpayers! (Score:5, Insightful)
Except setting up a brand new factory from scratch is expensive. Tesla is in their current location because Toyota, the previous owner, wanted out. So Tesla bought the entire factory for a good price with equipment in it.
The cost to move means having to either re-buy all the equipment again, or move the equipment. Both are very expensive options with the latter involving a whole system shutdown.
Boeing, despite having moved their head office, still makes planes in WA state where their head office used to be, because all the expertise and equipment is there.
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i think he means that the product is geared towards mid-to-upper class buyers and basically all (including poor) taxpayers are subsidizing it. It would be like apple getting subsidies for the gold iPhone.
Re:Thanks, California taxpayers! (Score:5, Insightful)
Tesla is not getting tax breaks for the Model S. They are getting tax breaks for manufacturing equipment. The Model S is not the only thing they build and sell with that equipment. Tesla batteries are used in the Smart car, the Mercedes B-class will use a Tesla powertrain, and they supply most of the guts for new Toyota RAV-4 EVs. It's a smart investment by California - they give Tesla a break on the equipment, and then get additional income from the increase in products that Tesla sells (both their own vehicles, as well as parts sold to other companies). It's not like they give Tesla the tax break and then never see anything from that money again.
Re:Thanks, California taxpayers! (Score:5, Insightful)
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Yup, the Lion cells are made by Panasonic in Japan, but the packs are assembled in Palo Alto, CA.
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From the state's point of view, it is an investment. The point is to give a company a relatively small tax break so that it will generate much more tax revenue for the state in the future.
It also falls into the category of x% of something is better than 100% of nothing.
To be clear, I'd push for the US and the individual states to eliminate business taxes altogether.
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You'd rather Tesla moves production offshore?
Businesses follow the money. If it's cheaper to go elsewhere, they go elsewhere, and take the jobs and profits with them.
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Tax breaks are an incentive to new and upcoming technology. It's great when it's helping a company like Tesla innovate an electric car. Giving tax breaks to companies that are well established is laughable. In the case of Tesla it's still a question of if they can keep increasing the tech at this level and how much of a benefit is it going to be to everyone. The gov. funds research in this exact same vein. Instead of investing in the company and taking a stock and risk being called a socialist they in
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No, it's bad when Tesla gets a tax break and it's bad when Airbus and Boeing get tax breaks. Businesses should not get tax breaks, ever, for any reason.
Why not? Any business tax is equivalent to a tax on citizens since anything that increases the cost of doing business (including taxes), gets passed along to consumers and employees through increased product costs or lower salaries. Many would argue that business taxes shouldn't exist at all.
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Once you subtract $180/mo in gas, it gets a lot less steep.
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Only if you are paying that much a month in gas... I try not to... and I drive what the state calls an SUV.
Heck, even over 5 years, the savings is *only* 10k, which only brings the effective price of the 40k car down to 30k... which is still more than most of us are willing/able to pay for something newer.
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Only if you are paying that much a month in gas... I try not to... and I drive what the state calls an SUV.
Heck, even over 5 years, the savings is *only* 10k, which only brings the effective price of the 40k car down to 30k... which is still more than most of us are willing/able to pay for something newer.
Maybe *most* of us won't pay $30K for a car, but the average new car price [usatoday.com] in the USA is $31K so that brings it within reach of a lot of potential buyers.
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The national average for gas this year was about $3.60, and your average 20-54 year old drives 15,000 a year.
http://www.fhwa.dot.gov/ohim/onh00/bar8.htm [dot.gov]
The average new car gets 33mpg, and the average new truck gets 25. That's $136/mo in gas, or $180/mo in gas.
The average car on the road in 2010 - the one you'd be replacing with a Tesla got 23mpg, or $195/mo. Considering it's been creeping up by a mile or so a year, let's call the average savings over replacing the average car on the road, driving the aver
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You can get a Leaf for about 22k after tax breaks, which means you don't break even on fuel costs for well after the life of the car (12 years),
I'd imagine that the range will be somewhat decreased, but if most Leafs which haven't been piloted into a tree (etc) aren't still operating in 12 years, I will be shocked. Hopefully not literally.
Re:Thanks, California taxpayers! (Score:5, Interesting)
Electricity is cheap. I pay $30/month for my car to go 1000 miles. How far does your car go for 30 bucks?
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Why would you wait overnight to charge? A Tesla can be charged in an hour at a Supercharger, which they are putting up all over the place on both coasts. If you are already planning on driving 16+ hours in a single day, then what's another 2-3? Or for those who want to enjoy their long drives (electric or gasoline car, either way) break it up into two days and it's even less of an issue.
Oh, and that's $30 for 1000 miles in a big luxury car that can seat 7 if necessary and go from 0-60 in 4 seconds if yo
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wow you are looking for things to rag on. If you live in an area with a tesla charge station it free to charge in about 30 minutes. If you don't it's not that expensive compared to a regular car. Which you can charge while you are at home. Unless you are traveling in excess of 160miles a day I find it unlikely on average that you will ever need to stop somewhere and charge your car.
Batteries die and it's a huge huge huge expense this is the only one I see relevant in your post.
If you are going somewhere
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Oddly, I've never been anywhere that I had to go more than a hundred miles without passing a few gas stations.
So I think it's unlikely I'll run out of gas at all....
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I think it's easier to find a plugin than a gas station.
Uh yeah, I doubt that.
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The least efficient coal plant is still massively more efficient in terms of pollutants and CO2 emitted per power generated than most efficient automotive internal combustion engine found in road cars of today.
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We get it back on taxes every (small) Tesla employee pays, every local supplier, and even the sandwich shop down the street.
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Except Tesla is *profitable* and wants to expand and *increase* that profitability. $35M will be peanuts to CA in a couple of years if Tesla keep growing at their current pace and paying corporate taxes (not to mention the job creation, cash infusion into the CA economy, etc).
So, yeah, wow, that $1 per CA citizen tax break is going to be a disaster...
Why shouldn't it? (Score:5, Insightful)
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There is nothing wrong with holding dirty industries accountable for the environmental damage they cause. Should they get a free pass on externalizing costs, granting them an economic distortion that gives them an unfair advantage? You as the tax payer ultimately foot the bill for environmental damage through cleanup costs, reduced quality of living, increased healthcare costs.
Tax breaks for green industries aren't handouts. They're just leveling the playing feild.
For that mater Tesla is the leader and majo
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"For the rich" is still a valid objection, pending future decreases in battery costs. However, your concerns about manufacturing process and moving energy use around are ignorant trolling. An electric car uses vastly less energy overall than an internal combustion engine (heat engines being limited by thermodynamics and material properties to poor net efficiencies). Even with "worst case" electrical power sources (burning fossil fuels to run generators), the full cycle efficiency of an electric car is far b
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Except that their plan is and has always been "sell cars to people in this income bracket, get money, use money to design/build cars to people in next bracket down, rinse and repeat".
Is there any evidence that their manufacturing is any more polluting that that of other cars?
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Even assuming fairly bad battery production overheads, you pollute at roughly the same rate as a 50mpg car while using electric from the grid as it stands.
California has a fairly green grid, so you'd need a 60mpg car to compete.
The Pacific Northwest is even better - needing nearly 70mpg to compete.
Oklahoma and other coal-burners are worse, and you only need 40mpg to compete.
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Second, it doesn't take in to account the manufacturing process of the cars, or the electrical sources used to charge the batteries. Pushing the pollution off somewhere else is not a solution, it's just shifting the blame.
Electric cars actually do better in terms of reducing pollution and energy usage versus normal cars. You should read the UCLA's electric car lifecycle analysis:
http://www.environment.ucla.edu/media_IOE/files/BatteryElectricVehicleLCA2012-rh-ptd.pdf
Even if you count the energy and emission
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Second, it doesn't take in to account ... the electrical sources used to charge the batteries. Pushing the pollution off somewhere else is not a solution, it's just shifting the blame.
Big electrical generation plants are considerably more efficient at energy conversion than a typical gasoline or diesel engine used in automobiles
So let me get this straight... (Score:5, Interesting)
Big corporations are evil because they don't pay their taxes unless it's our pet company in which case it's all wine and roses.
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Exxon and GE, as examples, are rather famous for not paying anything on their recent profit/income taxes (or even getting billions in rebates, in GE's case) while at the same time raking in world-record-breaking profits, and then taking that extra cash and simply lining the executives' pockets by paying out huge bonuses. They also downplay or ev
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Last time I purchased something in California... I do not recall there being a bomb proof barrier between me and the sales person that had been built by the state.
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Last time I purchased something in California... I do not recall there being a bomb proof barrier between me and the sales person that had been built by the state.
Yet, unless you arranged the purchase over Craigslist and met the seller in a bad part of town [gamespot.com] (in which case you're probably not paying any taxes anyway), law enforcement and regulation from the state and federal government has helped ensure that the clerk at the convenience store is not going to hit you over the head with a baseball bat and take your money, and you can walk into a huge big-box store and not worry that the roof is going to fall on your head - but if something like that does happen, then
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FWIW, the last time I heard of a roof collapse caused by snow burden, it was a government building.
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You've clearly never driven on California's roads (unlighted freeways with big potholes through major urban centers - really California?). Plus I suspect the Tesla plant mostly uses the rail line it backs up against.
Anyhow, the portion of taxes that goes to roads and police and such is a tiny fraction that no one feels bad about paying. At the federal government level its about 14% of spending, and it's similarly low at the local level. Alameda county, where the Tesla plant is, needs to spend roughly 100%
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Great News (Score:2)
This is great news for me and my shares in TSLA. :D
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Tesla's market cap is 25% of Ford's. I really wish them the best, but the stock already prices in insane growth from where they are now.
Horrah!! (Score:4, Insightful)
Another business that can't survive without tax payer money to help keep the costs down on a vehicle that only wealthy folks can afford. Brilliant.
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hey now... it takes money to bribe the government.
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Like Boeing? They were offered about $9 billion.
Yea, just like that.
Two wrongs don't make a right.
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Re:Horrah!! (Score:5, Insightful)
RTFA - The state the company is located in is one of the few with the madness to tax manufacturing equipment. There's a policy guaranteed to help lower unemployment! /sarcasm. In this particular case they're not surviving on taxpayer money - they're getting a sensible exemption from an absurd policy.
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the policy exists to help transition manufacturing to areas where labor can be more easily exploited. Guess they are now realizing that perhaps that was not a wise long term policy. but don't worry this sensibility will soon pass.
Re:Horrah!! (Score:4, Funny)
Pretty much every business that can has already left the state of California. We are left with service industry and tourism jobs that don't come anywhere close to a living wage, especially when you consider the real estate costs.
San Francisco is practically a wasteland these days - all of the tech companies that have no fixed assets thus can move easily have already left. You can stand in the middle of 101 at 8:30am and not see a single car for hours. Real estate has never been so low - landlords are offering 6 months free rent to anyone that comes, and multiple landlords are getting into reverse bidding wars to try to win you over with low prices.
Yeah, all of the businesses in California have packed up and left, leaving nothing but wildlife behind - which explains why Coyotes are moving into San Francisco [sfgate.com]
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Right. No one can afford the real estate costs; that's why they are so high.
No, they're high because people can still get mortgages that will bankrupt them when and if interest rates ever rise back to sensible levels.
How many people could afford those houses if they had to pay cash?
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No, they're high because people can still get mortgages that will bankrupt them when and if interest rates ever rise back to sensible levels.
This is assuming they have adjustable rate mortgages. Many of them probably do, but they are fools.
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Another business that can't survive without tax payer money to help keep the costs down on a vehicle that only wealthy folks can afford. Brilliant.
At least this time, we got off for 1/30th of what Solyndra cost us, and we get jobs out of it.
Re:Horrah!! (Score:5, Insightful)
The last step in making technology cheap enough for everyone is not something fresh out of R&D. It's something established that isn't cheap enough for everyone being refined and perfected and improved upon to suddenly be cheap enough for everyone. IBM and DEC didn't start out with commodity hardware. They made mainframes, then they made minicomputers, and then they made PCs and commodity servers.
This is American technology built with American manufacturing. In this day and age, that alone is exciting. This is electric cars -- not hybrids -- and they don't look like a Little Tikes Cozy Coupe. And the company is working to change nationwide infrastructure as well, and busting up the dealer middlemen that artificially inflate our auto prices. Fuck yes, I'd be happy to give them a tax break. They're actually doing something that might just benefit me as a citizen, a consumer, and an Earthling.
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Another business that can't survive without tax payer money to help keep the costs down on a vehicle that only wealthy folks can afford. Brilliant.
And above is another example of someone who can't think past next quarter's profit report.
Fortunately, there are people who can, and they've come to the realization that transitioning away from 100% reliance on fossil fuels is a good idea, and will benefit everyone in the long run.
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Models... (Score:5, Funny)
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finally geeks/nerds can complete the set and WIN
hey i resemble that remak
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They have actually registered the Model Y trademark.
http://www.teslamotors.com/forum/forums/s-e-x-y-trademarks [teslamotors.com]
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one advantage of a VAT (Score:5, Informative)
With a value-added tax (VAT), if you buy $150 of intermediary stuff, and use it to produce $200 of stuff, the tax is levied on $200 in total value, which is charged as $150 on the first sale and $50 to the second sale. If you buy equipment that is producing goods or more equipment, you only pay sales tax on the incremental value added, not on the cost of the machinery.
With a sales tax, you either charge on both sales for the full amount, in which case a $200 product has paid sales tax on $350 worth of sales in this example, or you do special-case exemptions, such as exempting "manufacturing equipment" from sales tax entirely, as some states do. Sales taxes are also more brittle because since the entire tax on charged on the final retail transaction, it encourages black-market no-sales-tax sales.
The Wealthy? (Score:4, Insightful)
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Why is it if some guy in Arkansas drops $70K on a Ford F450 "dually" he's just a hard-working good ol' boy, but if someone in California buys a Tesla they're they wealthy elite?
Let me guess: the first is buying his pickup because he needs it for his job, while the second is buying his Tesla because he'd be embarrassed to be seen in a Civic?
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How cute. People actually needing their truck for the job. That's the vast minority.
The F-450 is sufficiently ungainly to where most people will not drive one for vanity. I do know of one F-450 pickup truck conversion, which has a shortened frame and a custom bed, but even it is regularly used for towing.
Re:Oh thank christ (Score:5, Informative)
"Luxury" funds early adoption of tech when it's expensive. The cost drops later. At one time all automobiles were luxury purchases.
A computer user above all should understand how that works.
Customers whose purchases make high performance video cards profitable to develop come to mind as examples.
Re:Oh thank christ (Score:4, Insightful)
We should subsidize SSDs with taxpayer money, is what youre saying. Works for me.
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Undoubtedly South Korea already is, since Samsung manufactures SSDs now.
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