Fisker Misses $10 Million Payment to DOE as Feds Seize Reserve Account
April 23, 2013 9:49 AM
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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
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.
Wall Street Journal
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RE: Crony Capitalism
4/23/2013 1:08:17 PM
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.
"I mean, if you wanna break down someone's door, why don't you start with AT&T, for God sakes? They make your amazing phone unusable as a phone!" -- Jon Stewart on Apple and the iPhone
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