Odds Dim For Fisker Production In Former Del. GM Plant
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.