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Fisker woes deepen

Things aren't going well for electric automaker Fisker. The company was expected to file for bankruptcy protection this month and was forced to lay off 75% of its workforce. The unexpected slashing of its workforce led to a suit by former employees. Today we learned that Fisker has failed to make its first $10 million payment to the Energy Department to repay the massive federal loan it was given.

A spokesperson from the Energy Department named Aoife McCarthy said that the federal government earlier this month recouped $21 million of the $192 million it loaned Fisker.

"Given the obvious difficulties the company is facing, we are taking strong and appropriate action on behalf of taxpayers," McCarthy said.

"Using the safeguards we write into our loan agreements, the department stopped disbursing on the loan in June 2011 after the company, taking a significant chunk of taxpayer money with it short of the aggressive milestones that we had established as a condition of the loan," she said. "As a result, while our original loan commitment was for $529 million, only $192 million was actually disbursed."

Fisker’s current and former CEOs are set to testify at House hearing this week about the struggles with the automotive manufacturer. Along with the automotive executives from Fisker, Energy Department supervisory senior investment officer for loans program office, Nicholas Whitcombe, will also be testifying.

The Obama administration approved Fisker for the $529 million federal loan in 2010. The automaker produced only 2,500 of its plug-in hybrid sedans at an estimated cost of $660,000 each when federal and private funds are considered.

Source: Wall Street Journal

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Crony Capitalism
By ipay on 4/23/2013 12:19:24 PM , Rating: 5
The following is a list of all the clean energy companies supported by President Obama's stimulus that are now failing or have filed for bankruptcy.

A123 Systems (received $279M)
Abound Solar (received $400M/only borrowed $70M)
AES’ subsidiary Eastern Energy
Amonix (received $5.9M)
Babcock & Brown (Australian: received $178M)
Beacon Power (received $43M)
Brightsource (received $1.6B)
Chevy Volt (taxpayers basically own GM)
ECOtality (received $126.2M)
Ener1 (subsidiary EnerDel received $118.5M)
Energy Conversion Devices
Evergreen Solar
First Solar (received $1.46B)
Fisker Automotive
Johnson Controls (received $299M)
Mountain Plaza, Inc.
Nevada Geothermal (received $98.5M)
Olsen’s Crop Service and Olsens Mills Acquisition Co.
Range Fuels
Raser Technologies (received $33M)
Schneider Electric (received $86M)
Solar Trust of America
Solyndra (received $535M)
SunPower (received $1.5B)
The National Renewable Energy Lab
Thompson River Power LLC
Willard & Kelsey Solar Group (received $6M)

80% of DOE Green Energy Loans Went to Obama Backers

RE: Crony Capitalism
By Crazyeyeskillah on 4/23/13, Rating: -1
RE: Crony Capitalism
By ppardee on 4/23/2013 12:53:00 PM , Rating: 5
The problem isn't that they didn't want to be successful. The problem is that they didn't have the ability to be successful in a free market and our government used you and me to fund them to further Obama's (and the Left's) agenda. That's not how capitalism works.

The reason these people needed loans from the government was that they couldn't sucker enough investors in.

Yes, some businesses will just fail, but the difference between the government using our money to fund these failed businesses and an investor doing the same is that the investor is taking a risk for the possibility of a substantial financial reward. We are just taking it in the pants.

And you're also right that these companies are trying stuff that others have never done before, like solar panels, electric motors and running a profitable business. Or hybrid cars. You think Detroit didn't want to jump on this opportunity because they were paid off by 'Big Oil'? There wasn't a market for it, or where there was a market for it, the tech wasn't ready.

RE: Crony Capitalism
By Dukeajuke on 4/24/2013 9:45:07 AM , Rating: 1
I agree that it's sad that all these companies that were supported by taxpayers money have failed. But you are missing a big part of what is going on here. The US government has a long history of developing new technologies through government programs and Federal departments such as NASA and the DOD. And that is all paid for by your tax dollars right? The goal here was to develope new technologies to wean us off fossil fuels. What the Bush and Obama administrations did was to attempt to spur the development these new technologies by giving public "grants" to private companies instead of trying to do it within the federal bureaucracy (which is terribly inefficient). Some of these new energy companies have been successful, some have not. So was it a waste of taxpayer dollars? That depends on how much it has actually helped further develope alternative energy technology which I don't think can be measured yet.

RE: Crony Capitalism
By cmart on 4/23/2013 1:08:17 PM , Rating: 2
These companies like Solyndra may want to make money but with a government loan they have no incentive to succeed. It's a win-win for them, fail or not. Is Brian Harrison, Solyndra's former CEO, homeless and destitute? Is he in debtor's jail? Is he on the hook for one cent of our money that he blew and lost? Nope, nope, nope.

Oh, it's tough out there for start-ups, sure. But with no consequences for failure, it can be downright impossible for them and they don't care -- they'll just burn through our money and when it's gone, move on to that next pie in the sky.

RE: Crony Capitalism
By hartleyb on 4/23/2013 1:25:15 PM , Rating: 2
One of the items that is always missed in this argument beyond lack of customer demand is infrastructure. I wouldn't mind owning an electric car if it was reasonably priced and I could charge it at work, or in town. The reason no new energy policy has ever worked is the government hasn't put in place an infrastructure to support alternatives. For example (very Simplified), put in hydrogen pumps at all stations, and before you know it you will have people driving hydrogen powered cars. The consumer wants electric powered or alternative fuel vehicles, but there has to be an infrastructure to support it. You can't even take 99.9% of these cars to a local mechanic, because there are no parts on hand, and in many cases no parts via any kind of normal supply chain.

If you want electric or alternative fuel cars:

1. Build an infrastructure (Charging stations or alternative fuel stations across the country).
2. Start off providing cars that are electric, but have gas generators for when there is no charging station available, or if the distance is way beyond the battery capacity.
3. Put in place supply lines for parts and accessories.
4. Reduce cost (Maybe a turn in your gas powered car and get a specific price break type of program)
4. The only way 1-4 will happen is if you get the oil companies to build, and charge, for the infrastructure and power, or the oil companies will continue to lobby congress to vote against any normal expansion of electric vehicles.

RE: Crony Capitalism
By AntiM on 4/23/2013 12:49:04 PM , Rating: 5
What gets me is that... A spokesperson from the Energy Department named Aoife McCarthy said...
only $192 million was actually disbursed.

Only? ONLY 192 million? There are veterans that can't get decent medical care and the DOE seems to think that wasting 192 million dollars is no big deal.

I would love to see how much of this money went to exectutive salaries. I would love to see every dollar accounted for.

RE: Crony Capitalism
By Dr of crap on 4/23/2013 12:55:04 PM , Rating: 3
Just think of the good things all of the money COULD have done.
Better to invest in the power infracture, high speed internet to everyone, and others rather than loose money on START UPS.

If the company NEEDS that much to get going, maybe the time isn't right for it to start out and ask our govt for a hand out!

WE are in no postion to give out such large sums and not suffer from it. These are not times to loose that much money!

RE: Crony Capitalism
By btc909 on 4/23/2013 1:22:02 PM , Rating: 2
The mistake was not throwing up a shell solar company yourself to get in onto this cash grab. I'm sure thousand more companies played this game as well.

RE: Crony Capitalism
By KCjoker on 4/23/2013 5:56:09 PM , Rating: 2
Careful, you'll be called a racist tea bagger with those facts.

RE: Crony Capitalism
By maugrimtr on 4/24/2013 11:04:25 AM , Rating: 2
There's nothing racist or tea baggy about the list, so you'd have be an utter moron to go that route. This is not to suggest that Democrats are morons (which would be the next predictable response). Irrespective of opinion, the facts are that ALL governments "play venture capitalist".

Subsidies, tax breaks, low interest loans, bailouts and grants (for commercial projects) exist in all industries and not just clean energy. Look at what the Corn lobby has achieved over the past decade. Clean energy was just seized upon by a particular party with particular interests when it served a political purpose despite being utterly dwarfed by other industries.

It still stinks obviously. All of them do...

RE: Crony Capitalism
By BRB29 on 4/23/2013 10:39:19 PM , Rating: 3
Holy crap, can we stop this nonsense. Obama does not make the budget, Congress does. I wish we can all blame him so make it easier and just impeach him to get a new president. The reality is most of politician voted for it.

The blame the damn Director of DOE because these are probably his "friends"

Does Obama have influence in this? yes, but nowhere near the amount you think. Considering, it has to pass the House and Senate first...who do you think is really getting lobbied and bribed.

RE: Crony Capitalism
By foxalopex on 4/24/2013 11:46:00 AM , Rating: 1
Chevy Volt??

This is political bias if there was ever such. The Chevy Volt is a car NOT a company. Besides it's hardly failing or filed for bankruptcy. The Volt sells better than the Corvette last I heard.

I mean if you think this way you might as well list the Telsa Roadster? Nissan received a large amount of money for the Leaf, where are they? In 2012 Nissan sold fewer cars than the Volt did. Should they be considered a failure too?

Besides, the Volt was under development long before the Obama administration. The concept was revealed in 2007. Even if the volt doesn't sell huge numbers, the concept has proven to be solid for GM. They're putting the same technology into their other vehicles. Cadillac ELR, Spark EV. Owners haven't had any major issues with the Volt that would be considered showstoppers thanks to very paranoid testing by GM. The drivetrain was driven from Alaska to Arizona for years in modified Malibus. The roadster's battery pack would self-destruct if you over-discharged and the Leaf's pack dies in the heat of Arizona.

And yes I own one but guess what I'm Canadian. I am pleased to say that it can survive our brutal winters without much of an issue. I don't think a pure EV would work here. I got a $8,000 discount from our own government here to buy that car as a part of the electric car program here to try to clean up our cities. This discount applies to any electric car.

Your only valid argument is that the government bailed out GM which has nothing to do with this car. For that time will tell. Last I recall Canada even contributed a good chunk of money to GM because if they collapsed it would have seriously hurt our economy. (There's a few cities in Ontario who's primary employer is GM manufacturing.) The other choice would've been to let GM go bankrupt which I'm not sure would've been a good solution either. I saw Nortel collapse back in 2000 and I can definitely say the excess of IT workers totally messed up my job prospects for years.

The Fisker is a disaster. Even Consumer Reports broke theirs during testing and owners have reported problems with reliability and build. In comparison, nearly all of Volt's problems are by folks who don't own one or believe it has something to do with Obama. It doesn't. In the short-time I've owned it, it's done exactly as it's promised hence why it's loved by most owners. It's admittedly expensive but new tech always is.

By Zaranthos on 4/23/13, Rating: 0
RE: Fail
By othercents on 4/23/2013 10:28:22 AM , Rating: 2
No wonder they want to pass an internet tax.

Internet Tax is state and local tax not federal tax.

RE: Fail
By Newspapercrane on 4/23/2013 10:30:42 AM , Rating: 2
The internet sales tax is just allowing state and local governments the ability to collect Sales tax on the internet. Technically you're already supposed to pay it...

RE: Fail
By muIIet on 4/23/13, Rating: 0
RE: Fail
By Newspapercrane on 4/23/2013 1:16:07 PM , Rating: 2
Right, but if you're going to complain about the tax, complain about the sales tax. Don't complain about them getting the ability to enforce the laws that are already in place.

Don't like the Tax? take it up with your State and Municipal government.

By Chaser on 4/23/2013 5:54:00 PM , Rating: 2
"You put $90 billion — like 50 years worth of tax breaks — into solar and wind, to Solyndra and Fisker and Tesla and Ener1," he told the president. "I had a friend who said: 'You don't just pick the winners and losers; you pick the losers.' "

Screw Fisker!
By chunkymonster on 4/26/2013 1:30:09 PM , Rating: 2
Fisker was destined for failure anyway so this news is no real surprise.

The shame of it all was they accepted Obama-bucks to move their plants to Finland at the cost of tax payer's dollars and American jobs.

Just a shame the money being confiscated by the government can't be returned to the tax payer for subsidizing the Fisker failure.

"We are going to continue to work with them to make sure they understand the reality of the Internet.  A lot of these people don't have Ph.Ds, and they don't have a degree in computer science." -- RIM co-CEO Michael Lazaridis

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