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Fisker Karma
Bulk of loan will be used for new Project Nina

Plug in hybrids are one of the technologies that the U.S. government is pushing strongly to reduce the need to import foreign oil and to reduce the overall pollution in our atmosphere. As part of the effort, billions in conditional loans are being handed out to automakers with stipulations that the money be used for hybrid development in America.

The latest carmaker to get a substantial amount of money is Fisker. The U.S. energy secretary Steven Chu announced yesterday that Fisker had been granted a $528 million loan for advanced vehicle technology development. Specifically the conditional loan is to be used for the development of two different plug-in hybrid lines.

The development of the two plug-in hybrid lines is expected to offset millions of tons of greenhouse gas emissions and save hundreds of millions of gallons of gas. The new production and design work is expected to create or save about 5,000 jobs in America at parts suppliers.

"This investment will create thousands of new American jobs and is another critical step in making sure we are positioned to compete for the clean energy jobs of the future," said Secretary Chu. "Plug-in hybrid electric vehicles could revolutionize personal transportation and cut our dependence on foreign oil, not to mention give us cleaner air and less carbon pollution."

The $528 million loan was granted as part of the Advanced Technology Vehicles Manufacturing Loan program. Additional loans from the program will be granted in the coming months to small and large automakers alike.

Fisker will use $169.3 million of the loan funds for engineering integration costs as it works with U.S. suppliers to complete the Karma. The engineers will also design the tools and develop the manufacturing processes needed for production. The work will be conducted in the Fisker Pontiac, Michigan office. The final assembly of the Karma will be conducted overseas, but 65% of the Karma will be sourced from U.S. suppliers.

The bulk of the loan funds -- $359.36 million -- will be used for a project at Fisker called Project Nina. This project centers around the manufacture of a plug-in hybrid for the U.S. market and the estimate is that 75,000 to 100,000 of these will roll off assembly lines each year starting in 2012. Project Nina got its name from the ship Christopher Columbus used to discover the new world.

The upcoming Fisker Karma has a fuel economy rating of about 67 mpg.



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I'm skeptical
By AntiM on 9/23/2009 10:21:48 AM , Rating: 2
Over $.5 Billion? That's a LOT of money for something that will probably never live up to the hype. Producing 75,000 to 100,000 cars year doesn't mean you're going to sell that many cars per year. They won't be able to pay off their loan unless they sell the cars they produce. I don't see this as a good investment of taxpayer money. I smell a rat, a BIG rat. I wonder how much of this money will be spent on executive salaries and bonuses? I predict failure. I hope I'm wrong.




RE: I'm skeptical
By BZDTemp on 9/23/2009 10:31:19 AM , Rating: 2
Remember it is a loan not a gift. I'm sure Fisker had to show some pretty well documented estimates and not just pull number out of a hat.

I think Fisker is doing it right. Small scale production has a very hard time ever becoming more than that. From what has been written here and elsewhere in the past it is clear they are thinking big throwing money on how to manufacture and not just at creating the technology. in other words they think big and that is needed for it to be big.


RE: I'm skeptical
By AMcA on 9/23/2009 4:46:04 PM , Rating: 3
This is not a loan. Loans are made to businesses that have something more than "some pretty well documented estimates". Businesses that have "some pretty well documented estimates" seek equity financing because . . . drum roll . . . all they have are their estimates. No actual track record that might suggest they can repay the loan. Heck, these days, even businesses that have a track record - a genuine on-going business - are having trouble finding loan money.

Fisker is a HUGE gamble of a business. Remember, they have yet to build and sell a car, and we the taxpayers are tossing half a billion in venture capital at them?

The Feds have truly lost their minds. "Half a billion? that's nothing!" They've forgotten that this is real money, as opposed to a couple little numbers on a line in some budget.

Insanity.


RE: I'm skeptical
By BZDTemp on 9/24/2009 7:45:48 AM , Rating: 2
Of course they have not yet sold any cars. They have made prototypes to attract interest/feed back and are now making the investments to enable production. Once they have a production they will sell until then they have nothing to sell. As I said they are thinking big not niche market.

If you look at the people that makes up Fisker Automotive you do not find IT people but people from the car industry. Here is a wiki about the company: http://en.wikipedia.org/wiki/Fisker_Coachbuild

The two main figures at Fisker have both been important people at BMW and Ford. Henrik Fisker may be know for his design but when you design at a place like BMW and Ford it is more than just fancy drawings. It is also taking part in making the design go into production.


RE: I'm skeptical
By Shadrack2 on 9/24/2009 9:26:51 AM , Rating: 2
Unless the top execs at Fisker are putting up a good deal of their own cash and are held fiscally responsible if/when this goes tits up then I have to side with the previous poster.


RE: I'm skeptical
By BZDTemp on 9/25/2009 7:58:04 AM , Rating: 2
They have a successful running prototype!

I think you can be pretty safe a good deal of money have been invested in Fisker Automotive since that is not something that can be made from thin air.

I do not get why people are so negative about this. Yes there is more risk in lending money to a new company than there is in buying gold but it is not like this goes to a bank giving the money out as bonuses. What the Fisker people is gunning for is producing a hybrid people will really want to drive.


RE: I'm skeptical
By mars2k on 9/24/2009 12:22:07 PM , Rating: 2
Fisker has produced cars which have sold worldwide. The hybid represents a research effort however. There is no doubt they a a small producer but the upside of that is that on any given research project corporate overhead is lots less than a GM Ford or Chrysler. This is about getting the US up to speed in an important growth segment of the market.


RE: I'm skeptical
By Starcub on 9/25/2009 10:37:23 AM , Rating: 2
Hopefully, the govt. got some form of product guarranty from Fisker in return for granting the loan. Investments like this have the potential of contributing to competition in the marketplace, and keep the big three from price-gouging the consumer on new tech.


RE: I'm skeptical
By Spuke on 9/23/2009 12:13:17 PM , Rating: 4
quote:
That's a LOT of money for something that will probably never live up to the hype. Producing 75,000 to 100,000 cars year doesn't mean you're going to sell that many cars per year.
Unless this car is "cheap", it will never sell in those numbers, period. Lexus sells around 100,000 cars a year so with the majority of those sales being the RX (SUV). Base price of the RX is $37,250. Fisker will have to come in under that price, IMO, as they are unknown outside of enthusiast circles and will need to build their brand. Also, IMO, most of their initial sales will come from current BMW and Audi owners looking for something different. I don't think Lexus owners will be interested in Fisker's.


RE: I'm skeptical
By BBeltrami on 9/23/2009 1:15:23 PM , Rating: 3
Today: DOE loans a half-billion to Fisker for hybrid production.

Meanwhile: DOE grants 40 million for Nuclear research.

Big rat, indeed.


Um what?
By smackababy on 9/23/2009 9:52:08 AM , Rating: 2
quote:
The bulk of the loan funds -- $359.36 million -- will be used for an unannounced project at Fisker called Project Nina.

If it is unannounced, how do we know what it is called?




RE: Um what?
By amanojaku on 9/23/2009 10:01:35 AM , Rating: 2
Good question. It was never announced to the public, but it's no secret, either. The name was mentioned in the source article, so I assume Sebastian Blanco (the author) either contacted someone at Fisker or the DOE for details. That's the way a journalist usually does it, anyway.


RE: Um what?
By FITCamaro on 9/23/2009 10:05:47 AM , Rating: 2
It's kind of like the secret plan to assassinate Saddam Hussein that was announced.


RE: Um what?
By XZerg on 9/23/2009 10:06:37 AM , Rating: 2
Probably because it might not be announced officially as that. Kind of like Longhorn and Vista...


An Obama statistic method?
By mdogs444 on 9/23/2009 10:27:52 AM , Rating: 2
quote:
The new production and design work is expected to create or save about 5,000 jobs in America at parts suppliers.

There is no such thing. They are two totally different things - and "saved jobs" cannot even be calculated to begin with - which is exactly why the stimulus package has no legs to stand on.

If its going to "create" 5,000 jobs, then ok. But don't give me this "we gave them a $500+M loan, that I'm sure they'll never pay back, in order to save some jobs".




RE: An Obama statistic method?
By fic2 on 9/23/2009 12:50:47 PM , Rating: 2
Maybe we, the taxpayers, should have just loaned those people $100k each. Might have a hope of some of that being repaid then.


RE: An Obama statistic method?
By Motley on 9/23/2009 2:44:31 PM , Rating: 2
Maybe you can't calculate it, but that doesn't mean others can not.


By SoulBlighter on 9/23/2009 11:27:35 AM , Rating: 3
I would see more loans and developments been done for those companies which are manufacturing cars for common people. I can not afford anything over 25k to be car regardless how many mpg its showing. I think government needs to distribute projects for low cost family SUV and medium sized sedans.




Project Nina
By thomp237 on 9/23/2009 11:44:17 AM , Rating: 2
Project Nina, a top secret project to find the new world...

Maybe now Fisker can actually pay some of the people and companies that they owe money to.

And saving 5000 jobs. What a F'in joke. They are buying surplus parts from the GM parts bin. How exactly that will save 5k jobs is beyond me...




Will get nowhere
By viperfl on 9/23/2009 3:17:18 PM , Rating: 2
I think sales of 100,000 vehicles a year is a little over the top considering the car will be out of most people's price range. There won't be any cost savings because you buy an electric car, it will just be based on doing a good deed.




Or Was it the Niña?
By BlackIceHorizon on 9/24/2009 3:31:16 PM , Rating: 2
They name their $400 million project after an historic emblem and can't even spell is correctly? Come on people.

quote:
$359.36 million -- will be used for a project at Fisker called Project Nina.... Project Nina got its name from the ship Christopher Columbus used to discover the new world.


http://en.wikipedia.org/wiki/Niña




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