Odds dim for Fisker production in Delaware

WILMINGTON, Del. (AP) — A new court filing in Fisker
Automotive’s bankruptcy case appears to dash any remaining hope that the
failed electric-vehicle manufacturer’s new owner would build cars at a
former General Motors plant in Wilmington.
Anaheim, Calif.-based
Fisker, which had planned to build cars at the plant in Delaware, filed
for bankruptcy protection in November, ending a long, downward spiral
that began after it received a $529 million loan commitment from the
U.S. Department of Energy.
Hybrid Technology LLC, owned by Hong
Kong billionaire Richard Li, is seeking to buy Fisker’s remaining assets
in bankruptcy after paying $25 million for DOE’s outstanding loan,
resulting in a loss to U.S. taxpayers of $139 million.
After
initial uncertainty about whether the Delaware facility would be
included in the sale, Hybrid indicated in court papers Wednesday that it
plans to buy the plant, then resell it. Hybrid has offered to share the
proceeds from the sale of the plant, which has an estimated value of
about $50 million, with other creditors, but appears to have little
interest in building cars in Delaware.
"I think it’s a clear
signal that they don’t intend to use the manufacturing facility or
undertake any production in Delaware," said Sunni Beville, an attorney
representing Fisker’s official committee of unsecured creditors.
The
committee, working with Chinese auto parts conglomerate Wanxiang Group
Corp., has offered an alternative to the sale to Hybrid. Wanxiang made a
previous attempt to acquire control of Fisker and, in a separate
bankruptcy case, recently bought the company that served as Fisker’s
primary battery supplier.
Wanxiang, which also lost out to Hybrid
in bidding for the DOE outstanding loan, filed court papers Monday
saying it wants to replace Hybrid as the lead bidder for Fisker’s
assets, as well as the provider of financing for Fisker during the
bankruptcy case. But Wanxiang’s plans also do not include vehicle
production in Delaware. Instead, Wanxiang has indicated that it would
resume vehicle production in Michigan, not Delaware.
A hearing to
consider Hybrid’s plan, and possibly Wanxiang’s alternative offer, had
been scheduled for Friday but was postponed until Jan. 10 because of an
impending snowstorm.
Meanwhile, the Wilmington plant where
Democratic Gov. Jack Markell and Vice President Joe Biden announced with
great fanfare in 2009 that Fisker would build cars remains empty. A
lone engineer, one of only 21 employees still on the Fisker payroll,
keeps watch on the shuttered facility.
"He’s minding the boiler
and making sure the pipes don’t burst, things like that," Fisker
treasurer and vice president of finance Samuel Koroglu said Thursday at a
creditors meeting conducted by an attorney for the U.S. bankruptcy
trustee.
A Markell spokeswoman referred questions about the
apparently dismal prospects for vehicle production at the plant to an
attorney for the Delaware Economic Development Authority, which provided
about $20 million in loans and grants to Fisker and is likely to
recover no more than a fraction of a penny on the dollar. DEDA attorney
Michael Lastowski did not immediately return phone and email messages.
Meanwhile,
Koroglu confirmed that remaining models of the Fisker Karma, the
problem-plagued luxury vehicle that initially sold for about $100,000
but failed to meet several production milestones, have been fetching
rock-bottom prices. Koroglu said unsold Karmas bought back from dealers
have sold for between $37,000 and $40,000, while cars that were never
wholesaled are going for a few thousand more. Of the 144 Karmas left in
Fisker’s inventory, 100 are in Europe, and 44 are in New Jersey.
Koroglu
said that if production of the Karma resumes, he doesn’t believe cars
now in inventory will depreciate any further. If production does not
resume, he expects the existing vehicles to be sold for as little as
$30,000.
"Nobody’s anticipating a collector’s market for them?" asked Mark Kenney, an attorney for the
U.S. trustee.
"I don’t think so," Koroglu replied.
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