• Aug 28, 2013

As Department of Energy relaunches loan program, we consider past successes and failures

Adam Morath
A tale of two loans.

The U.S. Department of Energy has been both commended and condemned for its $25 billion Advanced Technology Vehicle Manufacturing loan program that launched in 2008 under the Bush administration, with initial funds awarded during President Obama's first term. Opponents of the loan program need only point to the failure of Fisker Automotive for a convenient example of what can go wrong. Supporters of the loans have a reliable retort in Tesla Motors.

Fisker hasn't produced a single Karma extended-range electric vehicle in over a year, has eliminated much of its workforce, and is reportedly receiving buyout offers worth only a small fraction of the automaker's outstanding debt to the U.S. government. The company's $529 million government loan was cancelled in 2012, with roughly $193 million of the loan distributed.

Tesla, on the other hand, has paid back its $465 million government loan ahead of schedule. The automaker's stock price is soaring as its all-electric Model S sedan rakes in awards and sales.

Bloomberg reports that the U.S. government has more than $15 billion of remaining funds to distribute, and they plan on using it. Spokesperson Aoife McCarthy told Bloomberg, "the program plans to conduct an active outreach campaign to educate industry associations and potential applicants about the substantial remaining funds available and the application process in general."

If you read between the lines, that may sound like Uncle Sam pleading "take my money!" but the program hasn't exactly been frivolous with its funds to date. Since 2008, only five companies have received ATVM loans: Ford, Nissan, Tesla, Fisker and The Vehicle Production Group. Other hopefuls, such as Carbon Motors, have been forced to close shop after not receiving a much needed piece of the pie.

Here's a look at the successes and failures of the DOE ATVM loans to date.

[Photo: Tesla/Fisker]

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    • 1 Second Ago
      • 3 Days Ago
      Made possible by the same geniuses that brought you digital tv and cash for clunkers. Both of which in my opinion were and are total failures.
      • 3 Days Ago
      As much as I like the Tesla result- My vote is for more gov't funds to basic battery R&D (capacity, price reduction and charge time reduction) then re-fund any critical projects cut down to the bone by the Sequester This program seems to have a big target painted onto it by Fox news. Redeploy the funds effectively elsewhere.
      • 3 Days Ago
      Hope he has more success that he did with these. $300 million for A123 batteries for 3000 jobs Got 700 jobs. $529 million for Fisker. It didn't reach mileage promised $465 million to Tesla. Has now lost $522 million. $535 million to Solyndra. Now Bankrupt $118 Million to ENER1. Now bankrupt. $43 million to Beacon power. Now bankrupt. $500 million for 80,000 green energy jobs. Got 8000 jobs $186 million for more energy saving jobs. Got 538 jobs. $200 million to create weather insulation jobs. Got 500 jobs