Posted on 05/08/2013 12:03:05 PM PDT by lowbridge
Another one of the Energy Department’s taxpayer-financed “investments” just went belly-up. This one died very quietly, without making a formal announcement, but USA Today noticed:
A Michigan maker of vans for the disabled that received a $50-million Energy Department loan has quietly ceased operation and laid off its staff.
Vehicle Production Group, or VPG, stopped operations after finances dipped below the minimum threshold required by the government as a condition of the loan, says its former CEO, John Walsh. Though about 100 staff were laid off and its offices shuttered, it has not filed for bankruptcy reorganization.
For a change, this company didn’t make battery-powered cars or solar panels. VPG received Energy Department funding because “some of its vans were expected to be fitted with engines fueled by clean compressed natural gas.”
USA Today reports their vehicles were selling well enough to create “a healthy order backlog,” but the company “ran low on cash and didn’t have the dealer network that it needed.”
That seems odd, given that VPG boasted of pulling in $400 million in private venture capital on top of their $50 million DOE loan. They couldn’t convince private interests to invest a little more in a company that had a backlog of orders – at least 2300 vehicles on order when production stopped six months ago, according to USA Today – and only needed more dealers to fulfill it?
(Excerpt) Read more at humanevents.com ...
Sounds to me like management mis-managed their considerable financial resources, if the facts in the article accurate. Not necessarily fraudulently, mind you, but that too is a possibility. Could have been things like over-spending on the expense accounts, an unnecessary health club/spa, too-fancy bathroom fixtures, to many middle managers and not enough actual workers, etc.
Anyway, you would think that a properly managed company with 2700 units on order and 100+ employees could find a way to keep going.
Something does not make sense here.
How do you have 2300 backorders if you do not have the dealers to process the orders?
In today’s internet age why do you need dealers to sell cars? I have a nephew that sells cars all over the world via the internet. He works for a dealer but I don’t see why this company could not function as their own dealer.
Another story the MSM will boycott.
Complete List of President Obama’s Taxpayer-Backed Green Energy Failures
(as of Thursday, October 18th, 2012)
Evergreen Solar ($24 million)*
SpectraWatt ($500,000)*
Solyndra ($535 million)*
Beacon Power ($69 million)*
AES’s subsidiary Eastern Energy ($17.1 million)
Nevada Geothermal ($98.5 million)
SunPower ($1.5 billion)
First Solar ($1.46 billion)
Babcock and Brown ($178 million)
EnerDel’s subsidiary Ener1 ($118.5 million)*
Amonix ($5.9 million)
National Renewable Energy Lab ($200 million)
Fisker Automotive ($528 million)
Abound Solar ($374 million)*
A123 Systems ($279 million)*
Willard and Kelsey Solar Group ($6 million)
Johnson Controls ($299 million)
Schneider Electric ($86 million)
Brightsource ($1.6 billion)
ECOtality ($126.2 million)
Raser Technologies ($33 million)*
Energy Conversion Devices ($13.3 million)*
Mountain Plaza, Inc. ($2 million)*
Olsen’s Crop Service and Olsen’s Mills Acquisition Company ($10 million)*
Range Fuels ($80 million)*
Thompson River Power ($6.4 million)*
Stirling Energy Systems ($7 million)*
LSP Energy ($2.1 billion)*
UniSolar ($100 million)*
Azure Dynamics ($120 million)*
GreenVolts ($500,000)
Vestas ($50 million)
LG Chem’s subsidiary Compact Power ($150 million)
Nordic Windpower ($16 million)*
Navistar ($10 million)
Satcon ($3 million)*
*Denotes companies that have filed for bankruptcy.
good times...
My guess is that two major things caused the crash and burn. Number one: excessive management salaries, bonuses and expenses. Number two: a price tag 2 - 20 times a regular vehicle with no possibility of post sales support or spare parts.
Michigan got a few of those companies when Grandmole was governor.
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