The Fisker Automotive saga continues, and a federal bankruptcy judge would like to see the story wrap up soon. The bankruptcy filing from November 22 could reach completion on January 3 of the new year under a faster-than-normal sale process approved by US Bankruptcy Judge Kevin Gross, according to Bloomberg. The traditional bankruptcy bidding procedures will be circumvented, and Gross admitted that it is a bit odd. "It is unusual to have, obviously, a sale without bidding procedures" and an auction, Gross told Bloomberg. Fisker hasn't built a new Karma in over 18 months.

In court papers, the extended range plug-in carmaker said the fast pace is justified since the company and federal officials conducted an "extensive" marketing effort prior to the recent bankruptcy filing. The US Department of Energy (DOE) held the auction to raise funds to pay off the $168.5-million loan it make to Fisker. The judge has agreed to hold a hearing December 10 to decide whether a disclosure statement has enough information for creditors to review and decide whether they'll be opposing the liquidation plan. Fisker attorney Ryan Preston Dahl had spoken with Judge Gross on November 26, asking that the liquidation plan go forward at the same time, which the judge permitted.

Fisker may owe creditors, many of them suppliers based overseas, up to a billion dollars.

It's likely that several attorneys will appear at the December 10 hearing and ask for an extension of bankruptcy court hearings. There are conflicting reports on how much is owed and whether the low-priced asset sale to Hybrid Tech Holdings LLC will come through. Fisker may owe creditors, many of them suppliers based overseas, up to a billion dollars. Hybrid Tech Holdings has been a somewhat mysterious investor group that Fisker owes money to; and Hybrid Tech may only pay the DOE $25 million at a reported $139 million loss to the federal agency.

At the January 3 hearing, Fisker will ask the judge to allow Hybrid Tech to exchange the debt it is owed for Fisker's assets. Fisker will also be asking for approval of its liquidation plan, which could eliminate future lawsuits filed by creditors. William Baldiga, an attorney with Brown Rudnick LLP, said in court that creditors are concerned that wrapping up the case so quickly means that creditors would be undercut on what they're owed.


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  • 13 Comments
      danfred411
      • 1 Year Ago
      Let's hear form Li how he plans to make this investment profitable.
      Marcopolo
      • 1 Year Ago
      @ EVnerdGene A billion dollars may sound a lot of money, but in the car industry it's a very modest sum. A new model from a major auto-maker with huge existing infrastructure, would cost more than a billion dollars. Auto-mobile manufacture is a high risk, low profit, capital intensive industry. Henrik Fisker was an established, and very successful designer. He designed a car based on his European experience. The design attracted the accolades of motoring writers, and international commentators, but drew unparalleled hatred from the US ultra right, and US leftist. .The right attacked Fisker because of it's green credentials, and because it was a high profile recipient of DOE loan funding. The leftists combined with EV purists, ( and those who just hated those who bought the Karma ), saw the Karma as a betrayal. The Karma was always intended to be a elite GT tourer. It sold on it's sensational looks and ability to create envy. The Karma's traded on the huge wave of popularity for all things 'green', ( green chic ) existing at the time of design. The Karma's market was always intended to be those seeking the latest fashionable status symbol, and at first Karma certainly succeeded. But building a production vehicle, with a complicated drive-train, is a very complex and expensive business, needing very deep pockets and a huge amount of logistical experience. Fisker sought to overcome as lack of those qualities by outsourcing the construction to Valmet. This solution would have made sense, if Fisker was an OEM, who can take advantage of a globalized shuffling of components, manufacturing and suppliers. But for a small bespoke maker like Fisker, with limited capital, such a manufacturing dynamic can easily turn into a logistical and quality control quagmire. ( which occurred). These factors, plus an extraordinary run of just plain bad luck, saw the fledgling, (and uncapitalised ) company unable to continue as an independent car maker. Gene, that's the risk investors take ! Business and investment is all about risk. Only a percentage of enterprises succeed. That's the way it works. If you can't afford to lose, then stick to the blue chips, or government bonds. But, it's not criminal to lose money, or fail. Nor, unless any laws are broken, are the directors personally liable for failures. Creditors, and investors, are involved because they want to make money. It's up to them, to do due diligence and be prepared to accept loses, along with the gains. Vale Fisker, Hale and farewell !
        EVnerdGene
        • 1 Year Ago
        @Marcopolo
        Marco, you can continue drooling over the Karma and defending it - until the day you die. And I, like for the past three years, will continue to say it was a dumb-assed idea - until the day I die. And yes, a $Billion is still a f'ing lot of money to the few of us still not ******* off the gov'ments teats. You said; "(and uncapitalised )." I assume you meant undercapitalized ? So you don't think it outrageous for niche/boutique car manufacturer to spend over a $Billion to bring a limited production car to market ? (and that didn't even include setting up a manufacturing plant - they outsourced it to Valmet - coat-tailing.) Just think of the break-even on that investment. Their biz-plan should've shown having to sell over 100,000 Karmas for that kind of investment to make any sense. Now finding out they owe another $Billion to suppliers, etc. Like I said; somebody didn't pay their bills. So where did the first $Billion go? Something stinks in the state of Denmark, and Finland, and Delaware, and Santa Ana/Anaheim, and Washington DC. "turn into a logistical and quality control quagmire." What did you expect? A bunch of naïve investors led by a naïve businessmen led by a car drawer. No I don't feel sorry for any of their investors. Suckers. Except for US taxpayers that lost $139 Million in the deal. Suckers thanks to the DOE sticking their nose deeply where it didn't belong.
          dlubeck_mbz
          • 1 Year Ago
          @EVnerdGene
          I completely agree with you. As you mentioned below, I can't believe someone is not investigating them and all their remaining employees who have continued to get paid. What are they doing? Why are each of those 20 or so remaining employees getting paid about $12K a month? Why isn't anyone questioning everything this company has done and all the waste of money (taxpayer, investors, vendors, landlord, etc)? They haven't been paying their bills since way before 2011--that's a fact. Seriously, even if Li could re-start production, who would want to buy this car and deal with this company? Henrik will probably come back to some high profile position, but what for?
          EVnerdGene
          • 1 Year Ago
          @EVnerdGene
          Marco, I guess you also missed the article where someone said it cost something like $120k to build each car. (You might remember that long ago I said they could not build the car for less than $100k - big red flag). Even if the $Billion was all investment that didn't have to be repaid, you still need to bring more money in than in going out - eventually - (like enough to fund your own future product development) or it's a Ponzi scheme.
          Marcopolo
          • 2 Days Ago
          @EVnerdGene
          @ EVnerdGene There is a difference between rationally analysing something and defending it. Gene, I billion dollars, is very little money for such an enterprise. Fisker doesn't have to recover all the billion form car sales, just sufficient to cover the costs of the business, service loan interest, and pay a reasonable dividend. The last two would amount to maybe 12% on invested capital in the first few years. The Karma was estimated to have a gross profit of in excess of $36,000 after Tax, dealer and distribution costs. Cost of operation, were calculated at $12,000, leaving a balance of $24,000. If Fisker could reach Karma sales of 5-7,000 per year the company was profitable. ( Not 100,000 !) One of the biggest problems was the DOE loan which carried with it an obligation to mass manufacture a volume model at the Delaware plant. (so did the conditions of purchase of the plant) Such a project was far beyond Fisker's expertise, resources, or financial capacity. Instead of concentrating on improving and perfecting the Karma, the company decided to divert precious resources into a project way beyond the companies capacity. That proved to be a disastrously bad corporate business decision. It was certainly a very unwise business decision, but it's not criminal behaviour. If the creditors wish to spend good money after bad, trying to pick over the bones, they have every legal right to fund an investigation, (as long as it doesn't hurt the purchase price) . ( IMCO, that would be a waste of time and money ).
      Alex82
      • 1 Year Ago
      I love Fisker especially Karma , since I saw it in www.fiskermiami.com I must have it.
      EZEE2
      • 1 Year Ago
      Uhm....good! Politics green energy rush Limbaugh Republican Party save the world. (I felt bad for Jon that the article had been up for a whole day and no one commented on it, or probably read it, do I figured I would say something so he feels better).
        Letstakeawalk
        • 1 Year Ago
        @EZEE2
        Sympathy comments? The staff at ABG should be very thankful that they have such a devoted fan base...
          EZEE2
          • 1 Year Ago
          @Letstakeawalk
          My sympathy comment got downvoted! Lol!
        EVnerdGene
        • 1 Year Ago
        @EZEE2
        Yeah, I feel obligated - like heading to the bathroom every morning when I get up. So do I understand this correctly ? They raised over a $Billion dollars in private markets for this. And now they still owe their suppliers over a $Billion. $2,000,000,000 divided by 1800 units = $1,111,111. each. Yowsir, excuse me while I run out to buy a Million dollar car for $60Thou.
          EVnerdGene
          • 1 Year Ago
          @EVnerdGene
          Not making any accusations; butt if I were a Frisker investor, I'd be demanding investigations (criminal type).. Why didn't they pay their bills? Where did all the money go?
          EZEE2
          • 1 Year Ago
          @EVnerdGene
          :D I suppose if Fisker had succeeded, it would have been seen to be a good move. Hindsight is 20-20, but in this case, did it ever seem to be a good idea? Elon Musk, for example, has money, brains, and can build rocket ships. Seems like a car might be a possibility. Did Fisker have the same background? Did the car seem to be well engineered? Although give Fisker credit...there were no stories of robots whistling Disney tunes....
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