Friday, February 5, 2016

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


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.

We encourage respectful comments but reserve the right to delete anything that doesn't contribute to an engaging dialogue.
Help us moderate this thread by flagging comments that violate our guidelines.

Comment policy: comments are intended to be civil, friendly conversations. Please treat other participants with respect and in a way that you would want to be treated. You are responsible for what you say. And please, stay on topic. If you see an objectionable post, please report it to us using the "Report Abuse" option.

Please note that comments are monitored by staff. We reserve the right at all times to remove any information or materials that are unlawful, threatening, abusive, libelous, defamatory, obscene, vulgar, pornographic, profane, indecent or otherwise objectionable. Personal attacks, especially on other participants, are not permitted. We reserve the right to permanently block any user who violates these terms and conditions.

Additionally comments that are long, have multiple paragraph breaks, include code, or include hyperlinks may not be posted.

Read 0 comments
comments powered by Disqus
About this blog

PhillyDeals posts interviews, drafts and updates that Joseph N. DiStefano writes alongside his Sunday and Monday columns and ongoing articles about Philadelphia-area business.

DiStefano studied economics, history and a little engineering at Penn. He taught writing and research at St. Joe’s. He has written for the Inquirer since 1989, except when he left a few times to work at Bloomberg and elsewhere. He wrote the book Comcasted, and raised six kids with his wife, who is a saint.

Reach Joseph N. at, 215.854.5194, @PhillyJoeD. Read his blog posts at and his Inquirer columns at Bloomberg posts his items at NH BLG_PHILLYDEAL.

Reach Joseph N. at or 215 854 5194.

Joseph N. DiStefano
Also on
letter icon Newsletter