Car Company Gets U.S. Loan for electric cars, Builds Cars In Finland

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**Frazzled**

http://abcnews.go.com/Blotter/car-company-us-loan-builds-cars-finland/story?id=14770875

Car Company Gets U.S. Loan, Builds Cars In Finland

ABC NEWS and iWATCH NEWS
Oct. 20, 2011
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 car company's founder and namesake told ABC News. "They don't exist here."

Henrik Fisker said the U.S. money so far has been spent on engineering and design work that stayed in the U.S., not on the 500 manufacturing jobs that went 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."

The loan to 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.

For more on the Fisker and Tesla loans and the Obama administration's green auto loan program, watch "Good Morning America," "World News with Diane Sawyer," and "Nightline."

Rob Carr/AP Photo
Vice president Joe Biden, left, and Henrik... View Full Size

Rob Carr/AP Photo
Vice president Joe Biden, left, and Henrik Fisker, CEO of Fisker Automotive announces that the company will produce plug-in hybrid electric vehicles at the former General Motors Boxwood Plant, Oct. 27, 2009, in Wilmington, Del. Solyndra Execs Stonewall Congress Watch Video
Solyndra: A Loan to Nowhere Watch Video
WH Dodges Energy Company Questions Watch Video
An investigation by ABC News and the Center for Public Integrity's iWatch News that will air on "Good Morning America" found that the DOE's bet carries risks for taxpayers, has raised concern among industry observers and government auditors, and adds to questions about the way billions of dollars in loans for smart cars and green energy companies have been awarded. Fisker is more than a year behind rolling out its $97,000 luxury vehicle bankrolled in part with DOE money. While more are promised soon, just 40 of its Karma cars (below) have been manufactured and only two delivered to customers' driveways, including one to movie star Leonardo DiCaprio. Tesla's SEC filings reveal the start-up has lost money every quarter. And while its federal funding is intended to help it mass produce a new $57,400 Model S sedan, the company has no experience in a project so vast.

READ the iWATCH News Story on Tesla and Fisker

There is intense scrutiny of the decisions made by the Department of Energy as it invests billions of taxpayer dollars in alternative energy. The questions come in the wake of the administration's failed $535 million investment in solar panel maker Solyndra. The company's collapse, bankruptcy and raid by FBI agents generated a litany of questions about how the Energy Department doles out billions in highly sought after green energy seed money.

A key question, experts and investigators say, is whether another Solyndra is in the offing.

In interviews, executives with Tesla and Fisker said comparisons to Solyndra are unfounded. Each said the government's investments will ultimately pay off by supporting a fleet of electric cars that will ease the nation's dependence on fuel and benefit the environment.

"It's absolutely a worthwhile risk," said Diarmuid O'Connell, vice president of corporate and business development for Tesla Motors. "I absolutely believe it was a good bet for American taxpayers." Tesla has said its mass production of the sedan will ultimately lead to profitability.

Henrik Fisker, the renowned auto designer who founded the car company that carries his name, said his company holds tremendous promise and has accumulated $600 million in private financing.

When asked directly by ABC News if taxpayers should worry about the more than $500 million in federal funds on the line, he was emphatic: "No, I don't think they need to worry about it," Fisker said. When asked if Fisker might be the next Solyndra, he said, "Absolutely not."

**Easy E**

Why wouldn't a company go where it can maximize its profit? Isn't that their fiduciary responsibility under current law?

Of course, the question is if the current system is set up to help America, or simply corporations with no loyalty but to themselves.

**Orlanth**

I blame the US Government not the company. Companies take money and build where profits are highest, if they got a grant without strict clauses forcing them to invest the money in the country that provides the support then it is on their head. Caveat emptor rules, with large sum contracts and subsidies it rules twice. Besides at least it is a low/non interest government loan, not a grant. So the US government should get its investment back and still gets electric cars on the streets, perhaps even at the agreed price. Technically the US government are getting what they paid for, assuming the finished vehicles sell in the US at affordable prices.

Frankly you Yanks get it easy. For real two faced, double dealing, subsidy swallowing backstabbers, try a British energy supplier.

**Frazzled**

Orlanth wrote:I blame the US Government not the company. Companies take money and build where profits are highest, if they got a grant without strict clauses forcing them to invest the money in the country that provides the support then it is on their head. Caveat emptor rules, with large sum contracts and subsidies it rules twice. Besides at least it is a low/non interest government loan, not a grant. So the US government should get its investment back and still gets electric cars on the streets, perhaps even at the agreed price. Technically the US government are getting what they paid for, assuming the finished vehicles sell in the US at affordable prices.

Agreed. This one really is the Energy Depertment's fault for letting the loan go without restrictions.
And the argument is bogus. If Toyota, Honda, Nissan, Ford, and now Kia can make (not just assemble) cars here, including the righteous G37, then some pissant electric car company with ties to the administration can.

Of course its moot. BMW just came out with an eletric uber sports car. There goes the Aryans making their Aryan supercars again.

Automatically Appended Next Post:
http://www.carsflow.com/bmw-i8-concept-hybrid-electric-new-sports-car.html

**SlaveToDorkness**

Sounds about right for D'Ohbama.

**Kanluwen**

I like that there's all this "Rabble rabble rabble!" without mentioning the exact wording of the Fisker head.

"There was no contract manufacturer in the U.S. that could actually produce our vehicle," the car company's founder and namesake told ABC News. "They don't exist here."

Henrik Fisker said the U.S. money so far has been spent on engineering and design work that stayed in the U.S., not on the 500 manufacturing jobs that went 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."

So the engineering and design work stayed within the US...but the 500 manufacturing jobs went to a "rural Finnish firm."

Now, if you want to point out "Why didn't they invest the money into upgrade a factory to be able to manufacture their electric cars?"--you have a much, much better point to work from.

**Karon**

SlaveToDorkness wrote:Sounds about right for D'Ohbama.

And he's still better than bush ever was and anyone running for President on the Republican side!

When I think of the United States, at first I'm like "LAND OF THE FREE, HOME OF THE BRAVE", but then I reality and I'm like "why did my family move here from Sweden when I was 3 years old?"

**Manchu**

This story really burns my biscuits. We talk a lot about the Republicans burning bridges but I would have hoped Democrats would be more sensitive to their base than this.

EDIT

Although Fisker said that, despite the big layoffs to American auto workers, no US automotive plant would build his car. Plus he says that he plans on producing a compact, less expensive car in Delaware. Leonardo DiCprio got the first of these $97K luxury versions from Finland -- building an image of quality and glamour by having movie stars drive your top-of-the-line cars before releasing a generally affordable version to the wider public seems like a good idea to me.

Looks like this isn't a Democratic gaff after all.

**Frazzled**

Kanluwen wrote:I like that there's all this "Rabble rabble rabble!" without mentioning the exact wording of the Fisker head.

"There was no contract manufacturer in the U.S. that could actually produce our vehicle," the car company's founder and namesake told ABC News. "They don't exist here."

Henrik Fisker said the U.S. money so far has been spent on engineering and design work that stayed in the U.S., not on the 500 manufacturing jobs that went 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."

So the engineering and design work stayed within the US...but the 500 manufacturing jobs went to a "rural Finnish firm."

Now, if you want to point out "Why didn't they invest the money into upgrade a factory to be able to manufacture their electric cars?"--you have a much, much better point to work from.

Your post clarifies nothing. At the end of the day US middle class taxpayers ponied up a loan for a company to give jobs to the Finnish. How does the UAW feel about that?
I mean I know when I think cars I think Finland, but really, you can't retool a freaking Saturn plant?

**Kanluwen**

Frazzled wrote:
Your post clarifies nothing. At the end of the day US middle class taxpayers ponied up a loan for a company to give jobs to the Finnish. How does the UAW feel about that?
I mean I know when I think cars I think Finland, but really, you can't retool a freaking Saturn plant?

And at the end of the day, you posted the first page of a five page article.

Page two actually has a fun little quote.

In a lengthy interview, Fisker said he apprised the Department of Energy of his decision to assemble the high-priced Karma in Finland after he could not find an American facility that could handle the work. They signed off, he said, so long as he did not spend the federal loan money in Finland -- something he says the company has taken care to avoid. He said the decision, ultimately, was to help prevent his company from following the path of Solyndra, which exhausted nearly all of its loan money on a high-tech solar manufacturing plant in Freemont, California.

So I'm not really seeing a problem, so long as the loan money is not spent in Finland.

Automatically Appended Next Post:
Ooh, or how about this quote!

Energy Department officials said such loans, by their nature, are risky because the department is financing innovative, potentially game-changing technologies that could deliver long-term benefits. They said neither firm has missed a loan payment, or sought help from the department to restructure their lending agreements.

**Manchu**

Frazzled wrote:At the end of the day US middle class taxpayers ponied up a loan for a company to give jobs to the Finnish. How does the UAW feel about that?

Actually, it's not the end of the day yet. Taxpayers supplied some venture capital so that a product could be designed. That product was created in Finland, seemingly either because American infrastructure was too backward or American businesses were locking Fisker out (remember when the Big Four told Congress that catalytic converters would put them out of business?). The product is now in the hands of a high profile American movie star -- Leo driving this thing around LA is a pretty good ad campaign regarding the sort of people who will be able to afford the coming version for general consumption. And that's going to be manufactured in Delaware.

So if we have another story later that says that those cars aren't being made in Delaware, then your point might have some weight.

**Nerivant**

"You hear about those electric cars? When are they going to Finnish them?"

**Frazzled**

Money is fungible.

Again, I am not terribly annoyed with the Company (ok I am their business is stupid and they will fail in the same epic manner that a cat would fail in trying to steal a snack from TBone). I am annoyed with the US government doing this.

Automatically Appended Next Post:

Nerivant wrote:"You hear about those electric cars? When are they going to Finnish them?"

**Phanatik**

Karon wrote:When I think of the United States, at first I'm like "LAND OF THE FREE, HOME OF THE BRAVE", but then I reality and I'm like "why did my family move here from Sweden when I was 3 years old?"

Why don't you enhance your reality and move back to Sweden?

Perhaps your family wanted to get away from the Socialism?

The radio is reporting that Al Gore has ties to the Finnish car company getting the loan to increase jobs in the U.S. by building cars in Finland.

Regards,

**Manchu**

Frazzled wrote:I am annoyed with the US government doing this.

For acting like a good capitalist?

Automatically Appended Next Post:

Phanatik wrote:The radio is reporting that Al Gore has ties to the Finnish car company getting the loan to increase jobs in the U.S. by building cars in Finland.

First, "the radio" is not a source. Second, your post does not reflect an accurate understanding of the news story.

**Kanluwen**

For doing what? Funding two companies(Tesla and Fisker) to make electric cars?

That first page is purposebuilt to get people rabblerousing. It looks like ABC realizes it's easier to get hits when you purposely post misleading loads of crap.

**Frazzled**

Karon wrote:
SlaveToDorkness wrote:Sounds about right for D'Ohbama.

And he's still better than bush ever was and anyone running for President on the Republican side!

When I think of the United States, at first I'm like "LAND OF THE FREE, HOME OF THE BRAVE", but then I reality and I'm like "why did my family move here from Sweden when I was 3 years old?"

Passports just require a photo and some paperwork. Don't forget to take a jacket. I hear its a might nippy.

**Chibi Bodge-Battle**

It's called global capitalism Frazz
It's what corporations do.

They prolly got big taxs beaks from Finland too

**Frazzled**

Manchu wrote:
Frazzled wrote:I am annoyed with the US government doing this.
For acting like a good capitalist?

The US government? Thats not capitalism.

Automatically Appended Next Post:

Phanatik wrote:The radio is reporting that Al Gore has ties to the Finnish car company getting the loan to increase jobs in the U.S. by building cars in Finland.

First, "the radio" is not a source. Second, your post does not reflect an accurate understanding of the news story.

**Manchu**

Frazzled wrote:The US government? Thats not capitalism.

Capitalism does not preclude government investment. In this case particularly there isn't even any government ownership. We're talking about a loan.

**Rented Tritium**

They didn't spend any of the government money in finland.

They didn't spend any of the government money in finland.

They didn't spend any of the government money in finland.

They didn't spend any of the government money in finland.

They didn't spend any of the government money in finland.

Should I keep going or do you understand now?

**Phanatik**

Manchu wrote:
Frazzled wrote:I am annoyed with the US government doing this.
For acting like a good capitalist?

Automatically Appended Next Post:

Phanatik wrote:The radio is reporting that Al Gore has ties to the Finnish car company getting the loan to increase jobs in the U.S. by building cars in Finland.
First, "the radio" is not a source. Second, your post does not reflect an accurate understanding of the news story.

First, do you know that guy google? He lets you look things up. It works even if you're not doing a dissertation, or term paper, or writing a book. You know, like Dakka. And golly gee, sometimes things on the radio are on google.

Second, perhaps you don't understand the Obama Administration. My post reflects Obama's frivolous spending of taxpayer dollars and his failure to (help) create jobs here in America. I didn't limit myself to one news article.

Have a nice day!

**Melissia**

Goddamnit energy department. You're making the TSA look competent. THat shouldn't happen.

**Manchu**

From the Wallstreet Journal piece via Huffington that Frazzled posted:

"This is not for average Americans," said Leslie Paige, a spokeswoman for Citizens Against Government Waste, an anti-tax group in Washington. "This is for people to put something in their driveway that is a conversation piece. It's status symbol thing."

About CAGW:

Two years ago [2004], the watchdog group Citizens Against Government Waste launched a lobbying campaign about avocados.

The group, which enjoys a strong reputation in the nation's capital for keeping an independent eye on government spending, plunged into an obscure agricultural dispute. It issued press releases and prodded its members to support avocados from Mexico

[...]

Citizens Against Government Waste did not reveal what motivated the aggressive campaign: It had received about $100,000 from Mexican avocado growers.

That's just one of many instances in which CAGW has traded on its watchdog reputation by taking money from companies and trade associations and then conducted lobbying and public relations campaigns on their behalf - without revealing that money changed hands.

From: http://www.sptimes.com/2006/04/02/Worldandnation/For_price__watchdog_w.shtml

I think it's pretty funny that a ~~grass roots~~ corporate-front like CAGW would criticize something for being a luxury good. Just like in this thread, CAGW are pretending like they don't know how advertisement works.

Automatically Appended Next Post:

Phanatik wrote:First, do you know that guy google?

When you make a claim, it's your responsibility rather than your audience's responsibility to cite what information backs the claim. You should have learned this in highschool.

I didn't limit myself to one news article.

That is completely apparent. Not only did you not limit yourself to one article, you didn't even bother to read it for comprehension.

Have a nice day!

**Chibi Bodge-Battle**

Finland doesn't make gak in the way of cars.

They do now!

**AustonT**

Karon wrote:
SlaveToDorkness wrote:Sounds about right for D'Ohbama.

And he's still better than bush ever was and anyone running for President on the Republican side!

When I think of the United States, at first I'm like "LAND OF THE FREE, HOME OF THE BRAVE", but then I reality and I'm like "why did my family move here from Sweden when I was 3 years old?"

You could always move back.

While I might not agree with the way that thinks went down, the company isn't responsible for employing American workers just because they took American money. Unless that was a stipulation of the loan, whic it probably wasnt. This is why the government shouldn't be "investing" tax money. Its not thier money to invest and if it's not being spent on "the common defense and general welfare" then it's unconstitutional to boot. Investing in businesses stretches general welfare a little too far, even for progressives.

**Manchu**

AustonT wrote: Investing in businesses stretches general welfare a little too far, even for progressives.

Let's not pretend that having the government act like it's a private entity is a "progressive" stance.

**Frazzled**

Manchu wrote:
Frazzled wrote:The US government? Thats not capitalism.
Capitalism does not preclude government investment. In this case particularly there isn't even any government ownership. We're talking about a loan.

1. Thats not capitalism
2. Thats not capitalism when those jobs go to a foreign country. Play hanky panky all you want. At the end of the day those jobs are not going to the US.
The management at the Energy Department needs to be terminated.

**Phanatik**

Manchu wrote:When you make a claim, it's your responsibility rather than your audience's responsibility to cite what information backs the claim. You should have learned this in highschool.

If you are simply going to nitpick, high school is two words. you should have learned that in high school. (nitpicking just doesn't sit right, does it?)

Again, I'm not defending a dissertation, a term paper, or writing a book. This is ...Dakka! It's perfectly acceptable for me to say the radio is reporting something, especially when it's true. If you disagree with it, you can devote any amount of time you want to copy and paste until your heart's content to refute it, if possible. That's your choice.

As far as my post regarding Obama, electric cars, taxpayer money, etc, ...irony?

In any case, you have a great day.

**Manchu**

Frazzled wrote:1. Thats not capitalism

Yes, it is.

Frazzled wrote:Play hanky panky all you want. At the end of the day those jobs are not going to the US.

As I already said, it's not the end of the day just yet. A private company got a loan from the US to design cars. It did that. It tried to build the cars in the US, too, (which was not a condition of the loan) but was shut out from reasonably doing so. In the meantime, Biden said that the loan would create American jobs. According to Fisker, we're simply not at that stage of the plan. If they put the cheaper cars into production is Sweden, then you can start calling it a failed investment per Biden's criteria.