Biden-backed Fisker Delaware auto plant, 2500 jobs, in doubt
Not content with over $200 million in state and federal money, Fisker may build overseas
Biden-backed Fisker Delaware auto plant, 2500 jobs, in doubt
Joseph N. DiStefano
Amid hardball negotiatons, upstart California carmaker Fisker is testing the Democrats' policy of subsidizing manufacturing jobs:
"Fisker Automotive Inc. said it is delaying production of its next-generation family sedan and may not build the vehicle in Wilmington, Del.," Detroit News reports here. "CEO Tom LaSorda," ex boss of Chrysler, said "Fisker may move production outside the United States" if it doesn't raise enough additional government or private money to build here.
In late 2009, Vice President Joe Biden joined a crowd of 1,000 - Delaware politicians and United Auto Workers members, mostly - announcing more than $500 million in low-cost US Department of Energy loans plus $12.5 mllion in state economic development loans and $9 million in utility loans from Delaware Gov. Jack Markell to retool the shuttered General Motors Plant in Stanton, west of Wilmington, and hire up to 2,000 construction, manufacturing and support workers to make Fisker electric-hybrid cars. From Delaware Gov. Jack Markell: "When Fisker and the Department of Energy reached an impasse over the distribution of the remaining loan, Fisker made clear they did not have the capital necessary to build out the Boxwood Road plant" (since a big US loan was to finance the Delaware plant).
He added: "Fisker said again during the unveiling that their first choice remains to build their next car in Delaware. That remains our first choice as well. If it becomes clear that Fisker’s need for additional capital leads them to build elsewhere, we will vigorously enforce our rights to recovery under the state’s loan agreement."
The state loans become grants (permanent) if the plant ends up creating the promised 2,495 jobs, says Markell spokesman Brian Selander.
The News says Fisker has already spent $193 million of federal money for its European-built Karma model and other projects. "But the Energy Department froze the rest of the loan last year amid talks about the company's business plan," the News reports. Fisker's small car, "the Fisker Atlantic, was to start production this summer in Wilmington. Now, LaSorda said, he won't decide where to build the vehicle until the end of summer, and said it might not come out late this year or next."
Wilmington "is still our primary choice, but we're looking at other options," he told the News, noting Fisker "is getting a lot of interest in building the Atlantic elsewhere... There's a lot of interested parties outside the U.S. willing to invest in the company."
Fisker laid off 26 workers in an initial Wilmington restart crew back in February. LaSorda said the Wilmington plant is "gutted and is ready to go" but no tools have been installed.
If Fisker opens the plant, it's a victory for Democratic-run Delaware, which has offered incentives to revive aging auto and oil plants and to new energy, health and distribution businesses. These efforts are popular with Delaware financial and labor leaders. But if LaSorda takes taxpayer money and runs, the result are an embarrassment for government-backed industrial policy and a boost to conservative Republicans who say government does a poor job picking winners.
Please let Fisker shop around for additional funding. They've already wasted enough taxpayer money. What happened to the other $300 million they raised through private funding, and if they decide to build a car overseas, they should refund the taxpayer money already spent.— unclejed- If they build offshore, then tariff their cars to the max.Anti-Americans company should be treated accordingly.— moretoit
At least the DRPA is out of money to waste!— HappyBob- Uh, which "oil industry" is Biden trying revive? Must be a different Biden they are referring to, not our VP.— TRexx
- Once again another waste of taxpayer dollars to prop unions jobs for a product nobody wants.— Wildman Bill
- Hahahaha....hey, Joe Biden, you gonna' come in for an orchestrated PR event at this place now??? Sheer stupidity!!!!!! Get the government out of the auto business....no more loans, grants subsidies- nothing. If they fail, then they fail. No big loss. It is how the business cycle goes....products which have no demand go by the wayside and new products which have natuiral demand fill the void.
Once again and as usual the government IS the problem and NEVER the answer....
Now, how many billions of dollars can we expect to be repaid this month by Chrysler & GM??? They still owe us tens of billions of dollars which are artifically propping up their organizations. When do the taxpayers get repaid???— kelprod2 - These loans were created in a bill passed in 2007, with regulations and funding passed in 2008. As such, it seems disingenuous to state that it is "Democrats' policy". Despite current GOP claims to the contrary, the program was passed with bipartisan support (86-8 in the Senate, 314-100 in the House).— Politburo
- and it is not a surprise,.....O's gift to his union buddies blows up in his face...think about it...the gov't bales them out and they still can't make....Messaget to unions...You still don't get it...Message to sheep and democratic koolade drinkers.....Your tax dollars are wasted by your union and government officials......— nuggett
- Biden+Casey= HUGE TAXPAYER EXPENSE and very little reward. Rather than throwing public money at a plant that will not be able to compete on the internation stage, maybe the Politicians should try to make Philly competative again by reeling in the anti-competitive unions.— Citizenc92
- The other party getting ignored is the Delaware union employees who were misled by Fisker and the PR politicians like Biden and Casey. Many have held off in getting other jobs. Maybe they should change the name to Frisker since that is what they have done to the taxpayers and the union workers.— Tired of Journos
- This is neither a Dem, nor a Rep thing. It's about a company gaming the system by creatively using the rules, lobbying, etc. I'm more interested in how the current admin moves towards closing the loopholes to make sure that companies can't pull an 11'th hour change like this, and to force them to return the money (not just what's left, but all of it) subsidized by the government. I agree with the concept of providing a means to help companies get off the ground, but there's just too much waste and abuse at this point for it not to be addressed and the rules enforced.— Yoda117
- How does Casey have anything yo do with this? You do know Delaware is not part of PA right?— Tiller
- Yoda...if a concept is viable, it will find plenty of private financing. This is yet another example of totally failed "stimulus" type of government waste.
And you are 100% correct, they should be forced to repay every dime. Ditto for GM & Chrysler...what are their repayment terms? When can taxpayers expect to be paid in full? Tens of billions of taxpayer dollars artificially propping up failed companies is simply terrible public policy.
Hope & change, hope & change....— kelprod2 - it's the corporate race to the bottom. They get one state to give them handouts and tax breaks and concessions, then go to the next state and say they have to do better than the last. Along the way they destroy the economy because all the "savings" just mean less money going into the economy as salaries and taxes.— Pelti
- Proof again it is time to get the "JV" off the field. In DC, DE, Pennsy too, throwing tons of borrowed $$$ at failed, or unproven concepts, when is enough "enough". Really, this ... has to stop— pymntboy
