Let me state for the record, I think that the Fiskar cars are cool looking and the drivability reviews have been stellar. I hope that the company is successful. However, hope is not a strategy nor is it a tactic. Following the previous failures of several other Federal “green” investments (e.g. Solyndra), the President is probably going to keep very tight reins on future taxpayer funded venture capital. That means that Fiskar Automotive is in trouble. It simply does not have a viable business plan that will be successful without government subsidies.
From the News Journal:
A cash crunch has forced Fisker Automotive to lay off some employees at the former General Motors plant near Newport that is being refurbished as its U.S. manufacturing base.
The exact number of layoffs that took place today and last week has not been disclosed by the California auto start-up, but state officials say about 25 Fisker workers and an unknown number of subcontractors had been involved in the rehabilitation of the sprawling auto plant. Fisker said it was to begin assembling the company’s Nina hybrid at the Boxwood Road plant in 2013.
The layoffs come as Fisker scrambles to trim expenses while it awaits the next round of cash from the Department of Energy, which conditionally promised to lend the automaker $529 million to help get its Delaware operations running.
“Until that happens, they’re trying to preserve the cash that they have,” said Alan Levin, Delaware’s director of economic development. “And unfortunately, until they meet the milestone that DOE continues to set … they’re not able to access the additional capital that they need.”
Fisker needs to meet specific production and sales goals in order to qualify for successive disbursements from the loan. In recent weeks, the company has scaled back 2012 sales projections for its first model, the Karmaluxury sports car, blaming mileage and emissions certification processes that took longer than expected.
Even more workers have been laid off at Fisker’s headquarters in Anaheim, Calif. Despite the most recent glitch in Fisker’s plans, Levin said he expects the company to prevail and succeed.
“The car has gotten rave reviews. It’s unfortunate they’ve run into snafus that always happen with a new company.” Levin said the state’s congressional delegation and Gov. Jack Markell have been in contact with Department of Energy Secretary Steven Chu in an effort to keep the loan funds flowing.
Fisker officials did not respond to phone calls this morning seeking details of and reasons for the layoffs.
Contact Eric Ruth at 324-2428 or firstname.lastname@example.org.
I wonder if the Delaware’s State and County incentives are still being spent?