SEARCH

Entries in Fisker Automotive (3)

Wednesday
Jul182012

GOP Zaps President's Backing of Electric Automaker Fisker, Obama's 'You Didn't Build That' Comments

Fisker Automotive Inc.'s Atlantic plug-in hybrid vehicle is unveiled in New York, US, on Tuesday, April 3, 2012. Peter Foley/Bloomberg via Getty Images(WASHINGTON) -- Republican National Committee Chairman Reince Priebus will spearhead an effort to re-focus attention on the 2009 economic stimulus and instances where American money was used by companies to outsource jobs or help create business overseas.

Priebus will make the argument at an event in Philadelphia and focus specifically on Fisker, the start-up electric car company that received part of a $529 million federal government loan guarantee from the Obama Administration.

A recent TV ad produced by Mitt Romney’s presidential campaign lumps Fisker in with failed solar panel manufacturer Solyndra.

Fisker has not gone bankrupt like Solyndra, but it has not yet carried through on plans to begin assembling cars in a U.S. manufacturing plant, either.

Fisker purchased a shuttered General Motors plant in Delaware with government help, and predicted it would one day employ 2,000 auto workers to assemble the clean-burning gas-electric family car, known as the Atlantic. That promise was enough for the Obama administration, apparently, but didn't materialize when the rubber hit the road -- as it never actually did: The Atlantic was already behind schedule when the company’s unsteady financial footing prompted the Department of Energy to freeze their loan payments.

The car company has continued to receive private financing and now says it will consider looking elsewhere -- including overseas -- for a cheaper place to produce its vehicles.

Of its initial $529 million loan guarantee, Fisker has so far received $169 million in stimulus funds. That money was used for the Karma, a $100,000 hybrid sports sedan that was assembled in Finland and is being championed by the owner of the very first Karma -- Leonardo DiCaprio. The company recently went public with its design for the less expensive Atlantic -- but it is likely to be years before that car is ready for the showroom.

“This is just another example of the president’s record of sending jobs overseas when he promised stimulus efforts would create jobs here in America,” RNC spokesperson Kirsten Kukowski.

Priebus will also focus on the news that the president’s job council hasn’t met in six months as well as continuing to blast the president for his comments regarding  entrepreneurs and Made in America businesses. On the campaign trail, Obama said, "If you’ve got a business, you didn’t build that, somebody else made that happen," claiming it was the government -- not individual ability, intellectual genius or business prowess -- that made American companies grow. 

The Romney campaign seized on the comments as evidence that the president is anti-capitalist. On the campaign stump Tuesday, Gov. Romney said to rising applause, "The idea, to say that Steve Jobs didn’t build Apple, that Henry Ford didn't build Ford Motor, that Papa John didn’t build Papa John Pizza, that Ray Kroc didn’t build McDonald's, that Bill Gates didn't build Microsoft…To say something like that is not just foolishness, it's insulting to every entrepreneur, every innovator in America, and it's wrong. President Obama attacks success and therefore under President Obama we have less success, and I will change that."

Copyright 2012 ABC News Radio

Wednesday
May302012

Fisker May Never Build Electric Cars in US

Peter Foley/Bloomberg via Getty Images(NEW YORK) -- The luxury carmaker Fisker Automotive continues to signal it could ditch plans to build its next generation hybrid electric vehicle in the United States, despite the nearly $200 million in Obama administration loan money it has already received.

Fisker received federal funds in part to help purchase a shuttered General Motors plant in Delaware, where it predicted it would one day employ 2,000 auto workers to assemble the clean-burning gas-electric family car, known as the Atlantic.

But company executives began hinting in February that it would reconsider that plan and look for a cheaper place to build the car after the Department of Energy froze the $529 million green-energy loan the company had received, and had been drawing on since 2010.

Fisker used the first $169 million in taxpayer funds to bring to market the Karma, a flashy $100,000 hybrid sports sedan that it assembles in Finland. After a series of delays and stumbles, the company announced it had sold its first 1,000 Karmas, bringing in $100 million in revenues so far this year. The sleek, high-end model has been well received by critics, and the company reported this week it has started to sell in Europe, and could soon be on sale in the Middle East.

Earlier this year, one of the Karmas stopped working in the middle of a Consumer Reports road test -- an embarrassing breakdown that Fisker later blamed on a faulty battery. The lithium-ion batteries became the subject of a recall, including for a defect that raised the risk of fires.

More recently, one of the high-priced cars went up in flames in the garage of its Texas owner. Fisker said the car was unplugged at the time of the fire and the battery pack was intact and still working after the blaze -- all clear indications, they said, that neither the car nor its battery had anything to do with the fire. A spokeswoman for the National Highway Traffic Safety Administration told ABC News the agency is "aware of the incident and is working with local authorities to evaluate whether there are any potential safety implications."

The U.S. Department of Energy has said little about its decision to freeze the balance of Fisker's loan, which was intended to pay for the development of the Atlantic. The department confirmed it hired a restructuring advisor to study the terms of the agreement and assess the performance of the company.

"The Department continues to review Fisker's financial and operating status and is working with the company to review its revised business plan, but no decisions have been made," an Energy Department official said in response to questions from ABC News.

Roger Ormisher, a Fisker spokesman, acknowledged that Fisker had failed to meet the government's milestones for the rollout of the Karma, and that those delays "put us into the process of negotiation with the DoE, who put further monies on hold until we could settle on mutually agreeable milestones" for the rollout of the next car.

It now appears that the company's decision about where to assemble the Atlantic could hinge on whether it will continue to receive federal support. ABC News asked Ormisher if Fisker still felt bound to manufacture the car in Delaware if federal funds were no longer available, or if the company would look for a cost-effective location in or outside the U.S. to build the car.

"If Fisker no longer gets government monies, then obviously we are in a place where other options are open to us and have to be considered from a business perspective," Ormisher said. "However, given the work that we have done at the plant in Delaware and the fact that we own it, it is still our primary option to consider."

Fisker appears to be preparing for the possibility it will need to move forward without further government support. The company has continued an aggressive push for outside investors.

"It is important to note that Fisker Automotive's success is not dependent on government money," Ormisher said. "We are primarily privately funded, having raised more than $1 billion in private equity financing since 2007."

One of the company's major backers is the venture capital firm Kleiner Perkins Caufield & Byers, according to published reports. The firm's partners include John Doerr, a billionaire tech mogul who serves on President Obama's Economic Recovery Advisory Board.

Copyright 2012 ABC News Radio

Monday
Feb062012

Another Green Energy Company Stumbles: Fisker Announces Layoffs

The Fisker Karma, seen in Washington, D.C., on Oct. 19, 2011. (ABC News)(NEW YORK) -- Fisker Automotive, the maker of an exotic electric sports car that is being built with help from a $529 million federal government loan guarantee, thanks to the Obama administration, has announced layoffs at its Delaware plant as it tries to persuade the Department of Energy to send it more public funds.

The company says 26 Fisker employees have been let go from the Delaware factory where renowned automotive engineer Henrik Fisker promised to one day begin producing affordable electric sedans. A Delaware newspaper also reported that subcontractors working on the car venture have been let go.

"It's temporary," said Roger Ormisher, a company spokesman. "We're being prudent and sensible as a company."

Fisker was one of a handful of auto companies to receive sizeable federal loans to help support the birth of an electric car industry in the United States. As ABC News reported in October, Fisker's efforts have been beset by delays.

Despite benefiting from U.S. taxpayer funds funnelled into the company by the Obama administration, the deal earned the ire of critics when the company signed a contract with a firm in Finland -- not the U.S. -- to assemble its first-generation electric vehicle, a flashy $97,000 sports coupe called the Karma which most taxpayers who helped keep the company afloat couldn't afford to buy anyway.

Accompanying the layoffs was an announcement that Fisker has approached the Department of Energy about revising the targets it had to meet in order to continue drawing money from the federal loan. Whether the Energy Department agrees to alter the terms and invest more taxpayer funds in the Fisker venture remains unclear. Critics of the Obama administration told ABC News they worried that Fisker was at risk of becoming the next Solyndra -- a reference to the now-bankrupt solar panel firm that received support from a government loan program.

Department of Energy officials said they understand that Fisker has experienced production delays, but said they are not uncommon for a new company. And the department remains hopeful about the company's future, in part because it has successfully raised more than $650 million in private sector investment to support its ongoing operations.

"Our loan guarantees have strict conditions in place to protect taxpayers," said DOE spokesman Damien LaVera. "The Department only allows the loan to be disbursed as the company meets certain milestones and demonstrates results. As has been widely reported, Fisker has experienced some delays in its sales and production schedule -- which is common for start-ups. As Fisker works through those issues and incorporates lessons learned from the production of the Karma, the Department is working with Fisker to review a revised business plan and determine the best path forward so the company can meet its benchmarks, produce cars and employ workers here in America."

When asked directly by ABC News in October if taxpayers should worry about the more than $500 million in federal funds on the line, Henrik Fisker was emphatic: "No, I don't think they need to worry about it." When asked if Fisker might be the next Solyndra, he said, "Absolutely not."

To date, Fisker has received $193 million in government funds, according to a company statement. Back in October, the company acknowledged outsourcing Karma assembly to Finland, but said that the bulk of its government funds would be used to launch a second-generation electric vehicle, still under wraps, that would be assembled in a shuttered General Motors plant in Delaware. Some of those hired to prepare the Delaware plant for that effort were among those let go.

That project, code-named Project Nina, has been put off until sometime in 2013.

"We have temporarily delayed work at the plant based on ongoing discussions with the DOE regarding funding for the Project Nina program," the company's statement said. "As a result, we have laid off 26 people."

Ormisher said Fisker has delivered between 250 and 300 Fisker Karmas in the United States, and the company is nearing approval to sell the cars in Europe.

The Obama administration has for months now been grappling with political attacks targeting its efforts to finance green energy start-ups. The financial meltdown of Solyndra has been the focus of a Republican-led congressional investigation and millions of dollars in attack ads by conservative groups.

The administration has defended its efforts, asserting that there has never been any evidence that political influence factored into decisions about which companies would receive Energy Department loans -- despite the fact that many of those loan recipients had close fundraising ties to Obama.

For instance, a top Obama fundraiser was also a chief private backer of Solyndra, the solar panel company. Similarly, a major investor in Fisker is a venture capital firm that lists former Vice President Al Gore as a partner.

Energy officials Monday touted a deal to recover money loaned to a less well-known firm, Beacon Power, which currently operates a 20-megawatt flywheel storage plant in Stephentown, N.Y. The company was the second recipient of Energy Department funds to file for bankruptcy. Under a deal announced Monday, taxpayers are expected to recover $28.7 million of the $39.5 million in federal funds that had been loaned to the struggling firm.

Copyright 2012 ABC News Radio







ABC News Radio