Energy Department Knew About Fisker’s Struggles And Still Offered the Loan image

According to newly released documents, the Obama administration has been warned in 2010 that Fisker was not able to meet the half-billion dollar loan’s conditions.

In June 2010 an Energy Department official said in a mail that the loan offered to Fisker might be jeopardized for failure as the automaker will not be able to meet the established goals. Sandra Claghorn, the DOE official wrote that Fisker “may be in limbo due to a lack of compliance with financial covenants” set by the Energy Department. An April 2010 document also listed milestones that Fisker failed to meet.

Although the Energy Department was warned about this issue in 2010 the money for Fisker kept flowing until June 2011, when the DOE stopped the rest of the funding, only after Fisker informed that it might not reach key milestones, such as launching the $100,000 Karma hybrid.

In December 2011 the DOE report said that the rest of the loan has been suspended due to Fisker’s ‘varied and incomplete explanations’ regarding the launch of the Karma. Fisker received $192 million from the total loan of $529 million. But the Energy Department Aoife McCarthy said that the email from June 2010 has been taken out of context.

“The document shows that one person at a meeting discussed the possibility that Fisker might not meet a financial commitment” required by the Energy Department, McCarthy said in an email yesterday.

The Energy Department might lose the $171 million loan, a similar situation with that of solar panel maker Solyndra which declared bankruptcy and fired all its employees after receiving a $528 million loan from the Energy Department.