Energy Dept. recoups $21M from struggling green automaker

The Energy Department disclosed Monday that it has seized $21 million from Fisker Automotive, the financially distressed electric car maker that has drawn $192 million in federal loans.

“Given the obvious difficulties the company is facing, we are taking strong and appropriate action on behalf of taxpayers,” spokeswoman Aoife McCarthy said in a statement.

{mosads}“[O]n April 11, the Department recouped the company’s approximately $21 million reserve account — funds that came from the company’s sales and investors, not our loan — and will apply those funds to the loan,” McCarthy said.

The collapsing company laid off the bulk of its workforce in early April and is seeking outside capital or a buyer. It might soon be forced to file for bankruptcy.

Fisker’s troubles and its taxpayer-supported loan will come under fresh GOP criticism on Wednesday.

A subcommittee of the House Oversight and Government Reform Committee is
holding a hearing titled, “Examining the Department of Energy’s Bad Bet
on Fisker Automotive.”

The panel is scheduled to hear from Fisker’s founder and former
chairman, Henrik Fisker, as well as its current chief operating officer, and a senior official
with the Energy Department’s loan programs office.

In 2009 Fisker won approval for $529 million in Energy loans. More than two-thirds of the amount was for plans to manufacture a plug-in hybrid car at a former GM plant in Delaware.

But the project struggled, and ultimately never got off the ground.

In June of 2011, the Department of Energy halted payments because Fisker had failed to achieve certain “milestones.”

McCarthy, the department spokeswoman, noted that the halting of the payments in 2011 and the seizure of $21 million in early April means that “these actions combined have already protected more than 2/3rds of our original loan commitment.”

Fisker on Monday failed to make a planned $10 million payment on the loan.

Energy Department loan and loan guarantee programs have come under heavy attack from Republicans and conservative groups since the 2011 collapse of the solar panel maker Solyndra and other bankruptcies.

But the Obama administration and its defenders say the programs have been a success overall. The programs support various renewable power, manufacturing, auto projects and more.

“While this is a hard time for [Fisker’s] employees and investors, our overall portfolio of more than 30 projects continues to perform well and more than 90 percent of the $10 billion loan loss reserves Congress established remains intact,” McCarthy said.


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