Will the gov’t-backed Fisker file for bankruptcy?
The government-backed Fisker Automotive company may be circling the drain.
A source told Reuters on Thursday that the luxury plug-in hybrid car maker has hired a law firm to advise the struggling company on a possible bankruptcy filing.
Fisker was the recipient of a generous $529 million loan guarantee in 2009, which was aimed at spurring the growth of the fledgling hybrid and electric car industry. The company used $193 million of the laon. However, the Energy Department halted the loan in part due to delays in launching Fisker’s luxury plug-in hybrid, the Karma. The company furloughed U.S. workers this week to save money.
According to Reuters, the company has not produced a car since last July and is currently seeking financial backers to help it roll out a second plug-in hybrid they call “the Atlantic.” The Fisker Karma runs for about $100,000 and has been sported by celebrities such as Al Gore, Justin Bieber, and Leonardo DiCaprio, who also invested in the company.
The venture capital firm Kleiner, Perkins, Caufield and Byers — where Gore is a partner — was a seed investor in the company. It spent $400,000 in 2009 and 2010 on lobbying, including for the stimulus bill, which contained $90 billion in green energy funding. The firm also lobbied for the American Clean Energy and Security Act, and the Clean Energy Jobs and American Power Act.
Fisker spent $280,000 in 2009 and 2010 to help along those same bills, reports the National Center for Policy Analysis.
The automaker has recently faced many challenges including the resignation of company founder Henrik Fisker and trouble finding a new investor in China.
Furthermore, it was reported last November that about sixteen Fisker vehicles parked in Port Newark, N.J., caught fire and “exploded” after they were submerged in surging water from Hurricane Sandy.
Previously, two Fisker Karmas caught fire at a home in Houston, Texas and again on the roadside in Woodside, California. No reason was given for the first incident, but the company determined the second was caused by a faulty cooling fan.
Fisker recalled 1,400 Karmas already privately owned and another 1,000 unsold Karmas in the wake of the second fire. Wired reported that was the third recall the company had issued in nine months.
Fisker must make another payment to the Energy Department in less than a month for the loan the company received in 2009. The company did not say how much was owed.
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