An electric car company that received more than a half-billion-dollar Obama administration-approved loan is reportedly now assembling its first line of cars in rural Finland, rather than in the United States. What's more, the car company, Fisker Automotive, is funded by a venture capital firm whose partners include former Vice President Al Gore.
To make matters worse, Fisker is more than a year behind in rolling out its $97,000 luxury "Karma" car, funded in part with Department of Energy funds. A mere 40 Karmas have thus far been produced, with only two delivered to customers -- one of whom is famed actor Leonardo DiCaprio.
With the approval of the Obama administration, an electric car company that received a $529 million federal government loan guarantee is assembling its first line of cars in Finland, saying it could not find a facility in the United States capable of doing the work.
Vice President Joseph Biden heralded the Energy Department’s $529 million loan to the start-up electric car company called Fisker as a bright new path to thousands of American manufacturing jobs. But two years after the loan was announced, the job of assembling the flashy electric Fisker Karma sports car has been outsourced to Finland.
“There was no contract manufacturer in the U.S. that could actually produce our vehicle,” the company’s founder and namesake told ABC News. “They don’t exist here.”
Henrik Fisker said the U.S. loan has been spent on engineering and design work that stayed in the U.S., not on the 500 manufacturing jobs that were exported to a rural Finnish firm, Valmet Automotive.
“We’re not in the business of failing; we’re in the business of winning. So we make the right decision for the business,” Fisker said. “That’s why we went to Finland.”
But shipping 500 jobs abroad is only part of the odd equation. According to ABC:
Fisker is part of a $1 billion bet the Energy Department has made in two politically connected California-based electric carmakers producing sporty — and pricey — cutting-edge autos. Fisker Automotive, backed by a powerhouse venture capital firm whose partners include former Vice President Al Gore, predicts it will eventually be churning out tens of thousands of electric sports sedans at the shuttered GM factory it bought in Delaware. And Tesla Motors, whose prime backers include PayPal mogul Elon Musk and Google co-founders Larry Page and Sergey Brin, says it will do the same in a massive facility tooling up in Silicon Valley.
Meanwhile, Tesla's SEC filings reveal the start-up has lost money every quarter, and while its federal funding is intended to help the company mass-produce a $57,400 Model S sedan, ABC reports that the carmaker has never tackled a project so vast -- raising doubts about the company's ability to produce.
An investigation by ABC News and the Center for Public Integrity's iWatch News slated to air on "Good Morning America," purportedly found that the DOE's bet carries risks for taxpayers, has raised concern among industry observers and government auditors, and raised additional questions about the way in which billions of dollars in loans for smart cars and green energy companies are appropriated.
Ironically, the Fisker's $100,000 price-tag eliminates the "other 99%" of the potential customer base. That may be just as well, since it offers worse fuel efficiency than many gas-guzzling SUV’s.
The Fisker Karma electric car, developed mainly with your tax money so that a bunch of rich VC’s wouldn’t have to risk any real money, has rolled out with an nominal EPA MPGe of 52.
Not bad? Unfortunately, it’s a sham. This figure is calculated using the grossly flawed EPA process that substantially underestimates the amount of fossil fuels required to power the electric car...
As I calculated in my earlier Forbes article, one needs to multiply the EPA MPGe by .365 to get a number that truly compares fossil fuel use of an electric car with a traditional gasoline engine car on an apples to apples basis. In the case of the Fisker Karma, we get a true MPGe of 19. This makes it worse than even the city rating of a Ford Explorer SUV.
The entire ABC report can be read here.