Skip to comments.Al Gore, DiCaprio AWOL as Fisker Circles the Drain (Updated: Bankruptcy lawter)
Posted on 03/29/2013 11:13:00 AM PDT by jazusamo
UPDATE 11:30 a.m. Friday: Reuters reports that Fisker has hired a bankruptcy attorney.
Fisker Automotive , which has received $193 million of a $529 million Department of Energy stimulusloan guarantee and apparently still wants the rest of it, stopped making its sole electric car the $102,000-plus Karma last July. But only now has it decided to furlough workers for a week.
In parallel with the process of identifying a strategic partner, Fisker is, of course, continuing to manage its day-to- day operations and has recently instituted temporary furloughs for its U.S. workforce covering the final week of March, the company said.
The announcement came this week from the company, which despite having raised more than $1.2 billion in private capital, hasnt been able to keep the factory lines running. In its official statement, though, Fisker said thats quite normal.
This is a common practice, particularly in the automotive industry, to manage costs and operations based on current activity levels and commercial requirements, the release said, according to Reuters.
True, the Big Three automakers have been well known to briefly sideline workers while they tweak plants to produce a different vehicle, or to adjust inventories, etc. But Fisker has only one model, and has not manufactured any since July. And apparently making CEO Tony Posawatz nervous is the fact that Fisker is required to make a loan payment of unknown quantity soon.
It appears the $1.2 billion is largely gone, as Posawatz has been desperately seeking partners namely in China to help Fisker build its next model, the Atlantic, which is supposed to be half the price of the Karma. But at $55,000, it will still be for rich people. There arent enough of those in the Orient to keep that vision alive, which is why two companies there ultimately withdrew their interest in a joint venture with Fisker.
So as a result, some 200 employees in the U.S. are idled. This is a drop from 775 employees in February 2012, when Fisker lopped off 71 workers when its plans to build the Atlantic in Delaware were shelved. Forty more were let go late last year, and apparently another 100 were dropped since December. But again, multiple media sources have said no Karmas have been produced for eight months, and as of October only 2,000 had been sold.
There are so many disturbing ways to quantify this. For the moment lets just address the $193 million that has actually been issued from taxpayers, and not the $529 million that was going to be (and theoretically still could be) issued. The stimulus funding was only to be for U.S. jobs design work and for manufacturing the Atlantic in Delaware but not for the assembly work at Valmet Automotive in Finland.
If you go by what has been recognized as the peak number of jobs since DOE approved the Fisker loan, then $193 million divided by 775 jobs equals a $249,032 subsidy per job. But of course those jobs didnt last, and the important ones are the permanent ones. None appear to fit that category in Fiskers current predicament, but if you could assume the 200 jobs that are left will continue, then the math works out to $965,000 per job. And if you want to count by vehicles sold, the $193 million subsidized each unit at $96,500. Karma owners Al Gore, Leonardo DiCaprio and Justin Bieber ought to be writing thank-you notes to taxpayers for the nice discount.
With all the money thats been poured into Fisker so far, especially by its seed investors at Kleiner, Perkins, Caufield and Byers, would they let it fail? Beyond the financial investment, there is the social benefit of helping our fellow man live in a healthier environment by assuring that Fisker vehicles remain on the road namely to fight global warming, so the advocates have said. And if you listen to environmentalists and Gore, who is also a KPCB partner, you cant put a price tag on that. Undoubtedly that justification was part of the lobbying effort when KPCB spent $400,000, and Fisker spent $280,000, in 2009 and 2010 to help along the stimulus bill, the American Clean Energy and Security Act, the Clean Energy Jobs and American Power Act, and other similar legislation.
Even the DOE Loan Program Office still touts the public benefits of taxpayer investment in Fisker, noting that the project would produce 2,000 permanent jobs, 17.4 million gallons of gasoline displaced, 154,000 tons of carbon dioxide avoided, and 30,000 annual cars off the road.
So clearly KPCBs partners, Palo Alto Investors, Gore, DiCaprio, thegovernment of Qatar, and other existing investors need to step up to keep their vision for Fisker alive. And clearly they have the resources to make it happen:
Unfortunately green investing is no longer viewed as the moneymaker that it was six years ago, as the Competitive Enterprise Institutes Myron Ebell explained earlier this week at GlobalWarming.org. He cited a summary of a conference hosted by the Wall Street Journal that was supposed to be a celebration of great opportunities in creating environmental capital, but instead was a downer. For example John Dears, chief investment officer of the California Public Employees Retirement System, reported their fund dedicated to clean energy technology has experienced a negative 9.7 percent annualized return since 2007.
Our experience is that this has been a noble way to lose money, Dears said, echoing a sentiment expressed by others.
But as renewable energy advocates and investors have said so often, whether in search of Recovery Act money or the preservation of special tax credits and breaks for their industries, no price is too high for the fight against global warming and the pursuit of clean energy.
Well, Fisker is fizzling, and the words of Gore, DiCaprio, and Kleiner Perkins still hang in the air. They have the resources, so its time for them to step up and save jobs, gallons of gasoline, cars on the road, and carbon dioxide emissions. While its not for their personal bank accounts, its for so much more their fellow man and the planet. Where are they?
Paul Chesser is an associate fellow for the National Legal and Policy Center and publishes CarolinaPlottHound.com , an aggregator of North Carolina news.
USA IS FLEECED AGAIN!
Never in the history of the world has a bankrupt company's car been so aptly named. Good job, algore, good job.
Yep, at least $193 Mil but probably much more.
All the “green energy” stimulus has been a bottomless pit for the waste of taxpayer dollars.
Gore Dogma Fails To Power Karma: Details At 11:00
All have failed. America loses, and Obama wins.
Old algore sure doesn’t put his money where his mouth is does he:)
Their next model: The Shadenfruede
Knowing how stupid these green libtards are they probably would name their cars like this. Karma, vanma, busma, truckma.
Just passed a Fisher Karma in Santa Cruz and wondered “ when all these POC crap vehicles can’t be serviced, where will their dumping grounds be?”
Calling that thing Karma seems so aprpos as I’m sure the owners of their exclusive being machine will be required to pay exorbitant disposal fees, to prevent the ground pollution these idiotic things will prouduce when they die.
Fisher was ale early disguised pyramid scam that largely benefited the founders and could never achieve their outlandish claims outlined above.
Agreed, Fisker has been a scam from the start as have many of the “green” companies.
$$Green Jobs$$ = Furloughed workers
Should have called the car Shockra.
Fisker Automotive , which has received $193 million of a $529 million Department of Energy stimulusloan guarantee and apparently still wants the rest of it, stopped making its sole electric car -- the $102,000-plus Karma -- last July. But only now has it decided to furlough workers for a week.