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Electric carmaker supported by US loan missed early goals

By Carol D. Leonnig and Joe Stephens
Washington Post / October 22, 2011

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WASHINGTON - An electric car company backed by more than a half-billion dollars in Energy Department loan guarantees has missed early manufacturing goals and has gradually pushed back plans for US production and the creation of thousands of jobs.

This week, Fisker delayed until 2013 the production of the moderately priced family car it plans to build in Delaware. It also learned that its Finnish-produced luxury model, the $96,000 Karma, which is two years late in reaching US markets, failed to meet a promised energy-efficiency standard.

With the demise of Solyndra, a solar company that also won a half-billion-dollar loan from a program to spur clean-energy technologies, the Energy Department’s loan guarantees have come under intense scrutiny, and the Obama administration has been under fire for making risky loans to unproven ventures. The administration has stood behind the stimulus-based lending, saying that risk is inherent in backing emerging technologies.

Fisker was among the big winners in the administration’s effort for broader development of electric vehicles, and company officials said their problems bear no resemblance to those of Solyndra, which filed for bankruptcy protection in September.

“Without any excuses, yes, we did have some delays,’’ company cofounder Henrik Fisker said during a stop in the District of Columbia this week to show off his company’s sleek new Karma. “But this is completely different. You can’t compare at all.’’

The Energy Department confirmed this week that it has eased expectations after conditionally approving the loan to Fisker and has made allowances for scaling back projections in the final loan agreement. But the agency declined to make public those adjusted terms, including projected car sales volume or milestones the company must meet in connection with its $529 million loan. Agency officials attributed Fisker’s delays to regulatory hurdles and issues beyond the company’s control.

Henrik Fisker said in an interview Wednesday that, as of this week, the Karma had been cleared for sale in the United States.

“Next year we will reach the 12,000 or 15,000 vehicles we predicted,’’ Fisker said. “We are really past the start-up risks. That means the skeptics who said we would never produce a car were wrong.’’

The Fisker commitment was questioned by some from the start, partly because of the company’s political connections. A key investor is a venture capital firm, Kleiner Perkins Caufield & Byers, whose partners include former Democratic Vice President Al Gore. The investment house raised $2 million for Obama’s 2008 campaign.

Fisker’s deal also generated controversy when the company announced that it planned to build its luxury model in Finland because it could not line up a US contract manufacturer. The Energy Department, reacting this week to an ABC News report on Fisker’s Finnish operation, stressed that loan proceeds are going exclusively to US suppliers.