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US Government Seizes $21 Million from Electric Car Maker Fisker
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April 24, 2013

US Government Seizes $21 Million from Electric Car Maker Fisker

By Nicole Spector
Contributing Writer

The U.S. Department of Energy (DoE) has confiscated $21 million from electric vehicle company Fisker Automotive. The move was made to collect on a $192 million loan that Fisker received from the government.

The DoE said it took back the money from a reserve account funded by car sales and investors earlier in April. The first repayment of the loan was due on Monday, the DoE said. Fisker's chief executive, Tony Posawatz, said the same last month.

In a statement, the DoE stressed that Fisker is facing “obvious difficulties.” The DoE also assured that it is “taking strong and appropriate action on behalf of taxpayers.”

Fisker's fate is cloudy. In a most recent statement by the Anaheim, CA (News - Alert)-based company, it suggested that it is trying to stay alive and has hired a new owner and appointed the bankruptcy attorneys Kirkland & Ellis LLP.

Since the confiscation on Monday, Fisker's outside public relations firm has made no comment on the situation.

In 2010, Fisker was granted approval from the Obama administration for a $529 million federal loan in an effort to fund the company's development of a luxury plug-in car. The automobile was to be built at a former General Motors (News - Alert) factory in Delaware.

It was to be called the Atlantic (more like the Atlantis, now). The car was to be the second model in Fisker's lineup, following the “Karma,” which Fisker produced in Finland. The Karma was to cost $100,000. When its production was halted, Fisker's financial troubles deepened.

The company has floundered to stay afloat. Earlier this month, Fisker went through with a significant amount of layoffs – dismissing 150 if its 200 employees to save money after talks with Chinese automakers Zhejiang Geely Holding Group and Dongfeng Motor Group for future work failed to go anywhere.

Fisker is reportedly still in discussion with the Chinese companies, along with other companies, says a source familiar with the matter.  

Edited by Rachel Ramsey

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