Contribute
CONNECT:

research

Taxpayers Continue To Lose On Obama’s Failed Green Energy Companies

- April 15, 2014

Last Year, Fisker Automotive Filed For Chapter 11 Bankruptcy. “Fisker Automotive, the moribund maker of the Karma plug-in hybrid sports cars that was backed with a loan by the U.S. government, filed for Chapter 11 bankruptcy protection on Friday after lengthy efforts by investors to salvage the company.” (Deepa Seetharaman And Timothy Gardner, “UPDATE 2-Fisker Files Chapter 11 As Investor Group Buys Company,” Reuters, 11/22/13)

  • Reuters Headline: “Fisker Automotive Failure Could Hit U.S. Taxpayers For Years To Come.” (Tom Hals, “Fisker Automotive Failure Could Hit U.S. Taxpayers For Years To Come,” Reuters, 11/25/13)

FLASHBACK: In October 2009, Vice President Joe Biden Called The Fisker Loan “Seed Money That Will Return Back To The American Consumer In Billions And Billions And Billions Of Dollars In Good, New Jobs.” BIDEN: “This is seed money that will return back to the American consumer in billions and billions and billions of dollars in good, new jobs.” (Vice President Biden, Remarks At The Opening Of Former GM Boxwood Plant, Wilmington, DE, 10/27/09)

And Now, A Deal To Settle The Sale Of Fisker Has Been Reached, Leaving Profits For A Chinese Billionaire While U.S. Taxpayers Lose Millions

Bloomberg Headline: “China Billionaire Profits While U.S. Taxpayers Lose With Fisker” (Bernie Kohn, “China Billionaire Profits While U.S. Taxpayers Lose With Fisker,” Bloomberg, 4/14/14)

In The Settlement Over The Fisker Automotive Sale, Hong Kong Billionaire Richard Li Is Going To Make A Profit On The Taxpayer-Backed Loan He Purchased Last Year. “Hong Kong billionaire Richard Li may have lost in the bidding war for Fisker Automotive Inc., but he is going to make a nice profit on the U.S. taxpayer-backed loan he bought last year. Court papers say unsecured creditors of the failed hybrid car maker have come to terms with Mr. Li’s Hybrid Tech Holdings LLC over how to split the cash Wanxiang Group paid for Fisker’s operations, some $120 million.” (Peg Brickley, “Fisker Creditors Reach Deal To Split Cash From Sale Of Operations,” The Wall Street Journal, 4/14/14)

  • The Billionaire “Ended Up With A Lovely Parting Gift At U.S. Taxpayers’ Expense.” “To hear the U.S. Department of Energy tell it, extracting $25 million for a busted loan to failed electric carmaker Fisker Automotive was a coup that cut the government’s loss to a more manageable amount. Now, a sizable chunk of that loss has become a profit for a billionaire who, while getting outbid for Fisker’s remains, ended up with a lovely parting gift at U.S. taxpayers’ expense.” (Bernie Kohn, “China Billionaire Profits While U.S. Taxpayers Lose With Fisker,” Bloomberg, 4/14/14)

Li May Receive Up To $90 Million From The Proceeds Of The Fisker Sale, Nearly Quadrupling His Investment. “Richard Li, the son of Hong Kong’s richest man, may receive as much as $90 million from the proceeds of Fisker’s sale of assets under a settlement reached by creditors. …Li argued he was entitled to the entire winning amount after inheriting the Energy Department’s secured-lending position. The settlement found a middle ground that will let Li almost quadruple his money while giving 20 to 25 cents on the dollar to creditors who at one point appeared to have little chance of seeing much of anything.” (Bernie Kohn, “China Billionaire Profits While U.S. Taxpayers Lose With Fisker,” Bloomberg, 4/14/14)

  • “Plenty Of Winners. Except One.” (Bernie Kohn, “China Billionaire Profits While U.S. Taxpayers Lose With Fisker,” Bloomberg, 4/14/14)

“U.S. Taxpayers Lost $139 Million Of The $192 Million Fisker Received” When Fisker Sold Assets In Bankruptcy Last Year. “Hybrid Technology LLC, a newly formed group, paid $25 million to win a U.S. Energy Department auction to take over Fisker’s defaulted taxpayer loan. The group includes Li, according to two U.S. government officials who were briefed on the deal and asked not to be named because the terms are private. U.S. taxpayers lost $139 million of the $192 million Fisker received.” (Angela Greiling Keane, “Fisker To Sell Assets In Bankruptcy At $139 Million Loss,” Bloomberg, 11/23/13)

And Delaware Taxpayers Could Lose Millions Of Dollars More

Governor Jack Markell (D-DE) Warned That Delaware Taxpayers Should Expect Little In Return From The Fisker Settlement. “Fisker Automotive’s unsecured creditors, including the state of Delaware, will receive $35 million in cash and stock under terms of a new bankruptcy settlement. But Gov. Jack Markell warned Monday that taxpayers should expect little in return for the $20 million in state economic development incentives he used to lure the failed electric carmaker to Delaware.” (Jonathan Starkey, “Fisker Creditors To Receive $35 Million,” The News Journal, 4/15/14)

  • Markell’s Spokeswoman: “’We Are Not Expecting A Substantial Recovery Of The State’s Investment.” “’We are not expecting a substantial recovery of the state’s investment,’ Markell spokeswoman Kelly Bachman said in a written statement Monday.” (Jonathan Starkey, “Fisker Creditors To Receive $35 Million,” The News Journal, 4/15/14)

In 2010, The Markell Administration Awarded Fisker $21.5 Million In Development Incentives. “The Markell administration awarded Fisker $21.5 million in economic development incentives in 2010 to help reopen General Motors’ shuttered Boxwood Road plant near Newport, and manufacture its second line of sporty hybrid sedans there.” (Jonathan Starkey, “Fisker Creditors To Receive $35 Million,” The News Journal, 4/15/14)

APRIL HAS BEEN A TOUGH MONTH IN THE NEWS FOR FAILED TAXPAYER-BACKED GREEN ENERGY COMPANIES

Smith Electric Vehicles, The “Centerpiece Of The Kansas City Area’s Once High Hopes For A Wave Of Green Industries,” Has Suspended Production. “Smith Electric Vehicles, a centerpiece of the Kansas City area’s once high hopes for a wave of green industries, quietly suspended production at the end of 2013 because of a shortage of cash.” (Steve Everly, “Smith Electric Vehicles Has Suspended Production,” The Kansas City Star, 4/4/14)

On April 1, 2010, Smith Electric Vehicles Received A $32 Million Federal Stimulus Grant. (Recovery.Gov, Accessed 4/11/14)

  • The Plant “Depended Heavily” On The $32 Million Federal Grant. “That leaves the Kansas City plant. It has depended heavily on the $32 million federal grant, which paid for some development costs and subsidizes the purchase price for vehicles in the demonstration project. Fleets operated by companies such as Frito-Lay buy the discounted vehicles, which include a telemetry system that provides live data on their performance.” (Steve Everly, “Smith Electric Vehicles Has Suspended Production,” The Kansas City Star, 4/4/14)

FLASHBACK: In 2010, Obama Visited Smith Electric Vehicles To Tout His Stimulus Spending

In July 2010, Obama Visited Smith Electric Vehicles To Defend His Use Of Grants And Stimulus Spending. “President Obama used a visit Thursday to Kansas City’s Smith Electric Vehicles U.S. Corp. to defend his administration’s use of grants and other stimulus spending to help pull the nation out of recession.” (David Twiddy, “Obama Visits Smith Electric Vehicles, Defends Stimulus Spending, The Kansas City Business Journal, 7/8/10)

“‘You’re Setting A Model For What We Need To Be Across This Country,’ Said President Barack Obama When He Visited The Plant In 2010.” (Steve Everly, “Smith Electric Vehicles Has Suspended Production,” The Kansas City Star, 4/4/14)

  • Obama: “You’re Helping To Fight Our Way Through A Vicious Recession, And You Are Building The Economy Of America’s Future.” “‘At this plant, you are doing more than just building new vehicles,’ he told an audience of around 100 employees, executives and their families. ‘You’re helping to fight our way through a vicious recession, and you are building the economy of America’s future.’” (David Twiddy, “Obama Visits Smith Electric Vehicles, Defends Stimulus Spending,” The Kansas City Business Journal, 7/8/10)

Previous post

Granite State ObamaCare Grief

Next post

Tax Day = ObamaCare Day
Republican National Committee

Connect With Us

Republican National Committee
Chairwoman Ronna McDaniel
News & Videos
  • 310 First Street SE, Washington, DC 20003
  • 202-863-8500

By providing your phone number, you are consenting to receive calls and SMS/MMS msgs, including autodialed and automated calls and texts, to that number from the Republican National Committee. Msg&data rates may apply. Terms & conditions/privacy policy apply 80810-info.com.

Paid for by the Republican National Committee. Not Authorized By Any Candidate Or Candidate's Committee. www.gop.com

By providing your phone number, you are consenting to receive calls and SMS/MMS msgs, including autodialed and automated calls and texts, to that number from the Republican National Committee. Msg&data rates may apply. Terms & conditions/privacy policy apply 80810-info.com.

Paid for by the Republican National Committee.
Not Authorized By Any Candidate Or Candidate's Committee. www.gop.com