Federal Politics

Published — February 6, 2012 Updated — May 19, 2014 at 12:19 pm ET

Another green energy company stumbles: Fisker announces layoffs

Electric car maker, Fisker, lays off workers and asks the federal government for continued support

Introduction

Fisker Automotive, maker of exotic electric sports cars being built with help from a $529 million federal loan, has announced layoffs at its Delaware plant as it tries to persuade the Department of Energy to continue backing it with public money.

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 the Center for Public Integrity and ABC News reported in October, Fisker’s efforts have been beset by delays — even after the company was touted by Vice President Joe Biden and others.

“Folks, we’re making a bet,” Biden said on Oct. 27, 2009 in Delaware. “We’re making a bet in the future, we’re making a bet in the American people, we’re making a bet in the market, we’re making a bet in innovation.”

While benefitting from U.S. taxpayer support, Fisker signed a contract with a firm in Finland to assemble its first generation electric vehicle, a flashy $97,000 sports coupe called the Karma.

As the layoffs were announced, Fisker approached the Department of Energy about the targets it must meet to continue drawing federal money. It is not yet clear whether the Energy Department will alter the loan’s terms, or invest more taxpayer dollars in the Fisker venture.

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.”

Critics of the Obama administration say they fear 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 only to shutter its doors.

When asked directly by ABC News in October if taxpayers should worry about the half-billion dollar federal investment, Henrik Fisker was emphatic: “No, I don’t think they need to worry about it.” Could Fisker be the next Solyndra? “Absolutely not,” he said.

Fisker’s loan commitment, of $528.7 million, was announced in September 2009. The loan was broken in two parts.

In the first, Fisker would use $169.3 million for engineering integration costs to complete its first vehicle, the Karma. Engineering work would take place in Pontiac, Mich., with support from the company headquarters in Irvine, Calif. — and final assembly completed overseas.

The bigger chunk of the loan, for $359 million, would bankroll Fisker’s Project Nina, a lower cost plug-in hybrid sedan. “Fisker estimates that up to 75,000-100,000 of these highly efficient vehicles will roll off assembly lines in the U.S. every year beginning in late 2012,” the Energy Department announced.

To date, Fisker has received $193 million in government funds, according to a company statement.

In October, the company acknowledged outsourcing Karma assembly to Finland, but said the bulk of its government funds would be used to launch the 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, the Nina sedan, 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 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.

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Mark Sullivan
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Mark Sullivan

Trump needs to conduct these activities because the entire MSM media, excluding Fox, is campaigning against him 24/7/365.

Didn’t Monica’s boyfriend’s wife and various criminal enterprises outspend Trump by almost 2-1?

CapitalistRoader
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CapitalistRoader

Why wouldn’t he get an early start on fund raising? Hillary outspent him two-to-one in 2016. The Dem’s are the party of big money. The President knows this and is attempting to get a jump on it. Of course the Dem candidate will outspend him in 2020 so it’s only rational that he starts fund raising now.

George Young
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George Young

Oh brother. We just 8 years of the Campaigner – in – Chief. Where was this journalistic rectal thermometer then. Just another article about 2000 words too long that merely takes another slap at Trump for something he far from initiated.

j stevenson
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j stevenson

The big difference between Trump and all the rest is his refusing to accept funds from lobbyists, so they don’t have the White House access they are used to. These are the donors who buy the presidency and are as pixxed off that he won the election as are the media and the Dems. Lobbyists have never been shut out of the WH and Trump has told them he is not for sale.

Anonymous
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Anonymous

Trump needs to be impeached and tossed in prison. Then have the key thrown away so he will never be free. Then he can see how it feels not to have freedom.

Mark Sullivan
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Mark Sullivan

Thank you for the usual insightful leftist low IQ Snowflake response.

barney
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hes not imprisoning them hes sending them back to their country chill tf out

SOUTH JERSEY
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SOUTH JERSEY

WHY DONT YOU HAVE FREEDOM?

Tom Larkin
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Tom Larkin

First, something positive. I was happy to learn of empirical information in article. BUT, the article was so slanted against President Trump as to be deemed fake news (“Perhaps Trump just lied.” (Two different issues)). The article mentions that President Trump raised over $67 million, but ended 2018 with $19 million. President Trump spent over $40 million 2016 and 2017. President Trump conducted 57 political rallies. The article notes the hats and T-shirts sold, but NEVER MENTIONS THE INCREASE IN THE NUMBER OF REPUBLICAN SENATORS during a mid-term election that lost the House and the number of political rallies in… Read more »

Ted Sirois
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Ted Sirois

At least Trump is getting donations from willing donors. Fresh from his first election, Obama used billions of our children’s tax dollars to save thousands of union jobs in the car industry and bailed out the banks and many Wall Street businesses. This secured his source of reelection funds for his reelection four years later.

South Jersey
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South Jersey

TRUMP 2020; IS AN AMAZINGLY SMART MAN! VERY ORIGINAL & CREATIVE. I AM HAPPY TO HAVE HIS AS POTUS.

SOUTH JERSEY
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SOUTH JERSEY

THIS ARTICLE WAS OBVIOUSLY WRITTEN BY, A TRUMP-HATE-GROUP. THAT FEELS; IT IS NOT NORMAL TO BE SUCCESSFUL WITH YOUR OWN BRAND NAME. WHEN, IF FACT, IT IS NORMAL! >>>>> THIS IS >>> FAKE NEWS!!! <<<< ie: A PACK-OF-LIES; SPUN INTO; DEFAMATION OF CHARACTER. FOR A SINISTER-AGENDA OF; FASCIST DEMOCRATIC SOCIALIST, COUP D'ETAT