Why did the state of Delaware fork over $21 million to a company that refuses to commit to building a plant in Delaware?
The company is Fisker. You may not have heard of it. Think of it as General Motors, but without any dealerships.
Lifted by $100 million in new cash from private investors, Fisker Automotive now says it will reveal in December where – and when – it will make its Atlantic model – the car the firm pledged in 2009 to assemble on Boxwood Road near Newport where Delaware’s last remaining auto plant sits empty.
“We intend to announce our production plans for the Atlantic and a timeline by December of this year,” CEO Tony Posawatz said in a statement announcing the results of a new round of venture capital fundraising that lifts the private stake in the California start-up to $1.2 billion.
Posawatz also claimed the firm has “resolved” the problems with the U.S. Department of Energy that caused the agency 18 months ago to halt Fisker drawdowns on a $529 million loan. The firm had used $190 million of the controversial low-interest loan to develop its first line of gas-electric hybrids, the $103,000 Karma, which is now assembled in Finland.
The rest of the federal loan was to be used to develop the Atlantic line and ready the former GM factory in Delaware for its production, using at least 1,200 workers. Delaware also provided $21 million in incentives to aid rehabilitation of the plant.
Posawatz, in an interview Monday with Bloomberg News, said the issues motivating the loan freeze had been “resolved,” although the flow of money has not been restored. “At an appropriate time we will revisit the discussion with them of the possibility of accessing the remainder of the loan,” he said. . . .
In that time, Fisker has remain vague about its Delaware plans – a stance not substantially altered on Monday by Posawatz, who left General Motors’ Volt program to take over as Fisker’s CEO earlier this summer. . . .
The Karma ended up as Consumer Reports’ lowest-rated luxury sedan.
To read more about this absorber o government funds, click the link.