Fisker Suspends Work on Delaware Auto Factory after Loan Blockage

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February 7, 2012

New York, February 7 (FinanceEnquiry.com) - Fisker Automotive Inc.’s federal loan has been blocked by the U.S. Energy Department, which said that the company had not met its agreed targets. Fisker had been awarded $529 million in loans in April 2010 from a programs set up to boost development of advanced-technology vehicles. Fisker was supposed to have used a part of the loan to redevelop a closed General Motors Co. (NYSE: GM) auto plant in Wilmington.

Fisker, which is behind schedule in selling its first car in the U.S., said that it has halted work on a Delaware auto factory to make plug-in sedans, after the stoppage of access to the loan. The company laid off 26 workers in Wilmington, Delaware. A spokesman for Delaware Governor Jack Markell said that the project in Delaware is at hold while negotiations between the two sides are going on to sort out matters.�

Fisker sells Karma, a plug-in sports car produced by a contract manufacturer in Finland, for $102,000 in the U.S. It was working on the Wilmington factory to produce the Nina, a lower-priced model.�

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Ever since the solar-panel maker Solyndra, a loan-guarantee recipient, announced bankruptcy in September, the loan programs of the Energy Department are under close Congressional scrutiny. As such, the Energy Department is imposing strict conditions on their loan guarantees to protect taxpayers.

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