Autoblog

Fisker loan spurs more questions from senators

Danny King — Wed, 27 Jun 2012 11:29:00 EST

Filed under: Hybrid, Government/Legal, Fisker, Electric

Um, about that $337 million.

Fisker Automotive and its pending federal government loan has spurred a letter from two U.S. senators to Energy Secretary Steven Chu questioning the appropriateness of the loan, The Detroit News reports.

In their letter to Chu, senators John Thune (R-South Dakota) and Chuck Grassley (R-Iowa) reportedly question the $529 million loan in part because of Qatar's ownership stake in the plug-in hybrid automaker. The senators also inquired about the loan earmarked for Fisker partner A123 Systems, the company whose batteries have been subject to a recall.

Fisker spokesman Roger Ormisher tells The Detroit News that the company is staying out of politics and focusing on creating U.S. jobs. California-based Fisker was granted the loan in 2010 but has drawn down just $193 million to date.

Energy Department spokesman Damien LaVera argues the loan was an appropriate part of the federal government's effort to help boost fleetwide fuel economy and said Fisker's delays are "common for start-ups," according to the report.

Last week, Fisker debuted its first national advertising campaign in a multi-page Wall Street Journal ad that included a statement from company founder Henrik Fisker proclaiming that the automaker has "set out to redefine and reshape how the world thinks about cars." Fisker also recently widened its European distribution network.

Upon securing the original loan grant, Fisker was slated to hire 2,000 people at a Delaware factory that was formerly run by General Motors. Production of the Fisker Atlantic shown above, which was originally scheduled to be produced at the Delaware plant, has been delayed until at least 2014.

Fisker loan spurs more questions from senators originally appeared on Autoblog on Wed, 27 Jun 2012 11:29:00 EST. Please see our terms for use of feeds.

Permalink | Email this | Comments

Chrysler abandons plan seeking more federal loans

Zach Bowman — Fri, 17 Feb 2012 09:28:00 EST

Filed under: Government/Legal, Chrysler, GM, Earnings/Financials

The Detroit News reports Chrysler is walking away from the company's pursuit of low-interest Department of Energy loans. The automaker originally applied for an $8.55 billion loan when it was still under Cerberus Capital Management, though the figure had since shrunk to $3.5 billion. The DOE, meanwhile, said it was considering a much smaller $2 billion loan with additional restrictions than were previously negotiated. The loan period would also be significantly shorter. Chrysler had sought the funds as a way to reduce the company's interest payments, which would have dropped by nearly 5 percentage points had the deal gone through.

Instead, Chrysler will use its own funds for capital improvements. The report says the company has nearly $11 billion in liquidity, though that figure includes $1.3 billion in an undrawn private loan.

Chrysler isn't the only automaker to walk away from DOE loans. General Motors pulled its application for a $14.4 billion loan last January. The funds would have gone toward retooling. The DOE and the Obama Administration have been hesitant to hand out more government money after the solar panel company Solyndra LLC received around $528 million loans before going bankrupt.

Chrysler abandons plan seeking more federal loans originally appeared on Autoblog on Fri, 17 Feb 2012 09:28:00 EST. Please see our terms for use of feeds.

Permalink | Email this | Comments

REPORT: Obama dropping "car czar" in favor of task force

Chris Paukert — Mon, 16 Feb 2009 07:58:00 EST

Filed under: Government/Legal, Chrysler, GM, Earnings/Financials, UAW/Unions

While there have been rumors and suggested candidates floated for the so-called federal "car czar" post, it now no longer looks like that position will be filled. That's because President Barack Obama has apparently gone cold on the idea. Instead, new reports suggest that he will look to a select group of senior economic advisers for guidance.

In lieu of appointing a single authority to help guide the restructuring of the Detroit Three, a senior adviser is suggesting that Obama instead plans to look to Treasury Secretary, Timothy F. Geithner; National Economic Council chairman Lawrence H. Summers, and Ron Bloom, a labor union and corporate restructuring expert. The three men will work with a presidential auto industry oversight panel, with Obama "reserving for himself any decision on the viability of GM and Chrysler."

The aforementioned panel will be known as the Presidential Task Force on Autos, and will incorporate officials from various government agencies, including commerce, energy, labor, transportation, and Treasury. A number of panel members are already embedded in the project, helping to develop viability plan proposals with the automakers themselves,

Both General Motors and Chrysler are scheduled to file restructuring plans with the Treasury in time to meet a Tuesday deadline, at which point Obama and his newly-assembled team are expected to review the plans for one-to-two weeks before issuing a public statement. More details at the link below. Thanks for the tip, Mike!

[Source: The New York Times | Image: AFP/Getty]

REPORT: Obama dropping "car czar" in favor of task force originally appeared on Autoblog on Mon, 16 Feb 2009 07:58:00 EST. Please see our terms for use of feeds.

Permalink | Email this | Comments