By on March 8, 2012

When solar panel maker Solyndra went bankrupt last year, which cost the taxpayer $528 million in DOE loan guarantees, the end of the DOE loan program was quickly prognosticated.  The loan program is still around, but new loans have for all intents and purposes dried up. Just a week after presumptive EV maker Bright Automotive called it quits and withdrew a DOE loan application, the program claims another victim. It is Carbon Motors, the Connersville, Ind. startup that wanted to sell fuel-efficient cop cars.

Yesterday, Carbon Motors said it was denied a $310 million DOE loan. Carbon Motors CEO William Santana Li says in a statement on the company’s website:

“We are outraged by the actions of the DOE and it is clear that this was a political decision in a highly-charged, election year environment. Since Solyndra became politicized last fall, the DOE has failed to make any other loans under the ATVM program, has pulled back one loan that it previously committed and, as of this month, the DOE has pushed aside the three remaining viable loans under active consideration.

Each of these applicants has been caught for several years in a costly and extensive DOE due diligence process. Carbon Motors simply appears to be the last victim of this political gamesmanship. In failing to deploy the tax dollars that Congress allocated for the creation of advanced technology manufacturing jobs in the U.S., the DOE ATVM program represents a glaring failure of the Obama Administration to create jobs that are clearly within its power to create.”

Bloomberg says that at least 14 members of Congress wrote to the Energy Department in support of Carbon Motors.

Asked for a comment, the DOE replied to Bloomberg:

“Over the last two and a half years, the department has worked with Carbon Motors to try to negotiate a deal that supported their business while protecting the taxpayers. While we were not able to come to an agreement on terms that would protect the taxpayers, we continue to believe that Carbon Motors is an innovative company with an interesting project and we wish them luck.”

Li thunders back:

“Although the DOE’s new found focus on protecting taxpayer interest may be a good talking point for the media, in this particular case, it fails to ring true. The highly efficient Carbon E7 vehicle would have had dramatic savings for the U.S. taxpayer and every city, county and state struggling with budget deficits. The DOE’s thoughtless decision just cost the U.S. taxpayer over $10 billion dollars of potential savings.”

It sounds like the Carbon cop car is DOA.

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56 Comments on “Denied DOE Loan Makes Carbon Cop Cars DOA...”


  • avatar
    harshciygar

    Ya, it’s pretty obvious Obama wants to take this off the table before the GOP gets its nominee in order.

    By the time Mitt secures the nomination, Obama will have a long list of dead, could-have-been companies.

    I thought maybe Carbon Motors was on to something, and there are a lot of advantages to having a purpose-built police car, versus re-configuring an existing platform.

    Guess we’ll never know.

  • avatar
    Dukeboy01

    Carbon Motors was the answer to a question that absolutely nobody was asking. Police departments already had a dedicated police vehicle platform for all practical purposes: The Ford Crown Vic. Even though Panther production has ended Ford, GM, and Chrysler all have worthy offerings to satisfy police requirements that can be resold to the general public when they reach the end of their service life in order to recoup at least a little taxpayer money.

    • 0 avatar
      S2L2SC

      The problem is that they are dependent on model cycles and changes from model to model. Carbon Motors would have elliminated a lot of the unpredictability in the process.

      Having a dedicated vehicle only for police use makes sense in a lot of ways… I know for a while there were issues with people pretending to be police officers and rapeing women.

      • 0 avatar
        TonyJZX

        Chevy Caprice is a ‘dedicated vehicle’ and even that is getting a fair bit of resistance from police and that’s a Chevy and it uses largely common components.

        I fear that Carbon is too far a leap of faith for conservative police.

      • 0 avatar
        philadlj

        Carbon Motors would ask already fiscally struggling police forces to trust them to build and maintain a dedicated police car in perpetuity.

        Let’s say some municipalities bite and are able to convince their struggling constituencies that this is a worthwhile investment. That’s just some, not all.

        Perhaps that “some” isn’t enough to keep Carbon afloat. Production and design problems swallow up all the cash, it all falls apart due to lack of takers, and those police forces who signed up for Carbon end up right back where they started – in search of a new model of police car to buy.

        I’d say the Carbon Motors experiment would be worth a try – if and when the economy fully recovers.

        But right now, it’s a losing proposition.

      • 0 avatar
        indi500fan

        They would still be dependent on the powertrain and many other suppliers to maintain continuity and availability over decades. And you know that’s not going to happen at any reasonable price.

      • 0 avatar
        charly

        Cause powertrains are a rapidly changing field. It is not like engines have production runs measured in decades.

    • 0 avatar
      MrGreenMan

      Agreed. Further, there’s an American obsession with militarizing the police since they invented SWAT in LA in the 1980s. Now, every deputy in Podunk needs to have an APC.

      Don’t the British use the Vauxhall Vectra, and the Italians use some FIAT scoot-about? They could get some Chevy Cruzes for ticketing, some E-series vans to bring back the paddy wagon for transporting dangerous offenders, and call it a day. If GM goes away, buy a Ford. Or a Honda. Or a Hyundai.

      Perhaps this also gives a chance to reconsider why Law Enforcement Officers need tanks, when Peace Officers could get about like the normal civilian citizens they used to think they were.

      • 0 avatar
        86er

        I don’t know. I’ll bet Bat Masterson’s horse was a cut above.

      • 0 avatar
        jimbobjoe

        Historically police used average cars as police cruisers. In the 60s and 70s large muscle cars became the norm, and police correspondingly adopted the same vehicles. However, they failed to downsize when everyone else downsized.

        This is the right time for police to get more normal vehicles. I can think of 4 great candidates off the top of my head–Toyota Camry Hybrid, Hyundai Sonata/Kia Optima Hybrid, Ford Fusion Hybrid, Nissan Altima Hybrid.

        Mid-sized vehicles, good performance (actually the new Camry Hybrid is surprisingly fast) and the gas mileage would be fantastic (especially considering police cars often just waste gas idling.)

        It is a culture change, so some politician will have to come along and force it (or perhaps it can be done via a local referendum, have the voters force it.) But it would be a good change.

      • 0 avatar
        MrGreenMan

        @jimbobjoe: The beauty of your recommendations: if you made more buyers for hybrid technology, sure there would be a short term spike in price, but that would speed the mainstreaming of the technology further, reducing costs as manufacturers could lock in variable costs with increased capacity for regular, recurring orders.

        That would, of course, build the hybrid business the right way: revenue, not grants/loans.

      • 0 avatar

        Ah…ha… A much more intelligent discussion..What needs to be done here is NOT a carbon police car, BUT, the legalization of marijuana…
        We need a progressive president…not a conservative one as we have now !!!
        Our nation is young in comparison to Europe, and, as usual, they seem to be leading the way..
        Not so bad, really, those who lead also make the mistakes, the history of Europe is full of them.

      • 0 avatar
        Lumbergh21

        I blame it on Mel Gibson and the “Road Warrior”.

  • avatar
    philadlj

    Perhaps, in this case, DOE actually learned a lesson about lending huge amounts of cash to dubious start-up ventures?

    So 14 members of Congress – “including Senator Richard Lugar” – supported throwing $310 million down the toilet in financing to fund the development of a police CAR.

    This, when municipalities around the nation have had to lay off police OFFICERS by the hundreds due to revenue shortfalls.

    If that money absolutely must be spent, I would think the general public would prefer more police officers out there protecting them then flashy new wheels for the few cops they can still afford.

    • 0 avatar
      Franz K

      + 1 x 100

      Allow me to add ; Here’s hoping ObamaClaus is finally coming to his senses , and drops all the minor league , Vapor Ware fluff he’s been throwing our Billions away on ( TESLA / Fisker /the VOLT fiasco / Bright etc ) and starts focusing on shovel ready projects as well as Infrastructure well needed such as added Police/ Fire Department personnel , Sewers , Road maintenance etc etc etc

      Well…… hopeless as it may be ….. one can hope …….. can’t one ?

    • 0 avatar
      psarhjinian

      Considering that crime has been falling for years, and that all the war on drugs has done is make petty drug users into criminals and increasing the costs (direct and externalized) of the justice system, perhaps letting go some police officers is not at all a bad idea?

      • 0 avatar
        Steven02

        psarhijinian
        Not to get side tracked to much, but the war on drugs changed the culture in the US to actually go after drug dealers which was most of the time over looked. It used to be much easier to find a dealer in many places. Don’t trivialize it into turning petty drug users into criminals. The war on drugs originally was about enforcing the laws already in place. Not letting drug dealers sell so openly.

        It probably has added costs to the justice system, but at the same time did a lot to curb crime for people who were addicted to drugs and would steal anything to pay for their habit. So please, don’t come here talking about how the war on drugs only put pot smokers who buy their weed from locally grown sources in jail.

      • 0 avatar

        Agree
        Peace officers rather than police….or law enforcers…We need better laws..
        Legalize marijuana.
        Control it an tax it…the same with “recreational ” drugs….and lets keep them in our nation, NOT Mexico..
        They have enough problems.

  • avatar
    relton

    You really think a cop car with a fussy, maintenance intensive BMW turbo diesel that requires expensive synthetic oil and frequent oil changes is going to live very long in a municipal garage environment?

    You really think a city councilman who votes to buy a cop car that costs 4 times what a Ford does, and is bought from an out-of-town company rather than through a local dealer, who not only votes but contributes to campaigns, is going to get re-elected?

    Yeah, I don’t think so either.

    I’m amazed tht Carbon Motors got as far as they did.

    Bob

    • 0 avatar
      28-cars-later

      You raise some good points about the local politics in many US cities. Even if this platform were fully developed and ready to sell, whose to say Ford/GM/Fiat-Chrysler won’t try to play the political scene in many small cities as you said, and even undercut sales to many departments just in a effort to move volume out of their respective factories.

  • avatar
    Carrera

    Carbon’s bigest problem was that the car was powered by BMW’s diesel V6 engines. Of course they would have been great engines but since they are not electric engines, they’re not liked by the administration: DENIED. The administration generally hates internal combustion engines. They should advertise on the DOE’s webiste: ” unless you’re builiding anything electric, don’t bother calling”. They don’t care how inefficient it is as long as it is electric.

  • avatar
    MarkP

    The idea of a purpose-built police car sounds good, but there is no way it could ever be cost effective, especially if it had to meet safety and emissions regulations. A hundred years ago? Maybe. Today? No way.

    This is one of those ideas that begins to fall apart under even modest scrutiny.

    • 0 avatar
      28-cars-later

      I’m sure they would have been exempt from emissions as necessary, after all gov’t is well aware of the scam its perpetrating with smog tests in modern cars.

      • 0 avatar
        MarkP

        Huh? I don’t know about smog tests; I was talking about emissions regulations that affect cars during manufacturing. Are you suggesting that those are a scam?

    • 0 avatar
      DC Bruce

      I’m not sure why the idea of a purpose-built police vehicle sounds good . . . unless state and local governments (and their taxpayers) are prepared to pay DoD-level prices. The purpose-built vehicles lose the scale economies that keep the price of civilian vehicles relatively low, and, as someone pointed out, these vehicles will have no resale value . . . adding to their cost to the agency which owns them.

      I think this is true even if the purpose-built vehicle is manufactured by an established company, already in the car business. The idea that a start-up would successfully sell a police car to any police agency — other than one run by the company owner’s brother-in-law — is just insane.

      The is not like the U.S. Postal Service letting out a contract for a postal delivery vehicle.

  • avatar
    86er

    Weren’t these things going to cost about $80,000 per unit, even with DOE loans to prop up their business model?

    • 0 avatar
      psarhjinian

      How much does a hybrid Tahoe go for these days? Doesn’t GM give them out as prizes in cracker-jack boxes?

      • 0 avatar
        86er

        “Doesn’t GM give them out as prizes in cracker-jack boxes?”*

        *offer only available in TX.

        Less facetiously, they’re probably down to the level of regular Tahoes, but then the police will just buy regular Tahoes and save themselves the needless complications of the hybrid add-ons…

      • 0 avatar
        Joe McKinney

        Police use the Tahoe PPV which is a pursuit-rated, police package. The Tahoe PPV features a lowered suspension for better handling along with the usual, police spec. heavy duty brakes and electical and cooling systems. The price for the Tahoe PPV is comparable to other GM, Ford and Chrysler police vehicles.

  • avatar
    spinjack

    Through various gov’t biding processes I learned that capital costs rule. Recurring costs (maint and such), are not as important when making purchasing decisions. From that standpoint, Carbon as going to have a hard time of it.

    However, the behavior of the DOE is unforgivable. First they give out billions of $ to drinking buddies, then they pull back all funding when they get called on it. Corrupt.

  • avatar
    Steven02

    The Volt has problems selling at 40k, not including incentives.

    Why does anyone think that a company who doesn’t have local dealerships anywhere can sell a car to police at 80k? I don’t care if the mileage is better. Police cars take a beating and this company has no record at all. I don’t see many police departments buying this.

  • avatar

    I trust government more than private enterprise.
    How do we know that this “Carbon Car” is not just another scam, similar to Solyndra ??????And speaking of trust…..the media…sensational based…the truth is second to profits..
    Only our Congress (too many conservatives) is worse than the “media”..

  • avatar
    Lumbergh21

    “We are outraged by the actions of the DOE and it is clear that this was a political decision in a highly-charged, election year environment.”

    Really? That’s a revelation along the lines of “I’m shocked to find gambling going on…Here’s your winnings, sir.” All government programs are political in nature and motivation. It doesn’t matter if your project meets the criteria established by the government. It doesn’t matter if your project is a good idea or will help the most people. What matters is if you can get the ear and the voice of the right Senator. And, I don’t think that should be a surprise to anybody. I always advise to steer clear of low or no interest loans offered by the government for the simple reason that you could and probably will end up putting more time into meeting their requirements and increase the cost of your project to the point that you actually end up losing money versus a conventional loan.

  • avatar
    MrGreenMan

    “We are outraged by the actions of the DOE and it is clear that this was a political decision in a highly-charged, election year environment.”

    Mr. Li is not angry that they made a political decision; he is angry that he didn’t get the political decision he wanted.

    Having pitched investors in Ann Arbor on non-automotive things, it’s clear that, if this had any viability, he could have walked around AA with a wheelbarrow to load up the cash from investors. Automotive old money wants to invest in little automotive start-ups to make a Midwest answer to Tesla. There’s a built-in provincial dislike for the west coast that would have made an Indiana start-up seem like a long-lost cousin — again, if the business plan didn’t start with, #1, borrow money from the government, #2, get the government to buy what we made on their dime.

  • avatar
    Franz K

    FORD should buy this project out !

    If Mulally has Half the brains everyone credits him for , he’d scoop this project up – put a FORD engine under the hood – Market the car AS a FORD and I’d bet the PD’s would be lining up to buy them once their CV’s beyond repair

    An added bonus would be FORD creating a ‘ Civilian ‘ version for general consumption as well , as more than a few of us out here would love a high performance , easy to maintain 4dr

    If Mulally had half a brain . Which IMHO he Does Not !

  • avatar
    Franz K

    Try telling that to those of us living in one of the many ( majority actually ) large US cities/metropolitan areas where crime is in fact once again on the rise and it takes some 45 minutes for the Police to respond to an emergency call even though the station is less than three miles away .

    Either that or keep on believing the hype/myth/propaganda being reported in the Press these days and watch your cities fall into ruin after almost 20 years of constant revival . A hint ? Most if not all of the Up and Coming neighborhoods in US cities have now become the Come and Gone’s

    FYI @ psarhjinian

    • 0 avatar
      Lumbergh21

      I had a gun stolen out of my car. You would think that the police would be more interested in that. Not really, still over 1 hour response time same as when the air compressor was stolen from my garage. Cop came by, asled some questions, and gave me a case number.

  • avatar
    areader

    Connersville, IN has been flat on it’s back since the main employer, Ford/Visteon closed the huge local plant a few years ago. They held a huge “pray-in” asking their supreme being to help them if they were worthy. Guess they were found wanting since no help materialized. This Carbon Motor deal was a scam from day one. They managed to lift several million bucks from the pockets of desperate locals in the process. No way in hell this made any sense. Potential customers, states and local, are worse than broke, and an expensive, unproven car from a company that shows no signs of being viable without govt. money is not the answer. The oh so conservative, prudent republican officials were supportive of course. No doubt this crew is already at work on their next scam.

  • avatar
    360joules

    As someone who spends a lot of time wrestling with the other “1-percent,” I can understand the rationale for a specialty use police care. Too bad this venture failed.

    The perfect police car needs a very strong crash cage to protect occupants in high speed crashes, it needs a durable suspension and chassis to handle prolonged high speed chases and a durable engine and drive train to handle short interval/high demand situations like pursuit and low demand situations like prolonged idling (handled by a large radiator and transmission cooler). A police car needs an engine powerful enough to support the various radios and computers on squad cars and to keep it from melting down at idle.

    Crown Victorias and Impalas satisfied only a few of these requirements. Too bad a marketable solution has yet to be found.

  • avatar
    photog02

    So their business plan is highly dependent on the presence of a single federal loan program and anyone is surprised that they are outraged at that loan program’s cancellation?

  • avatar
    Spartan

    If this company wants to be successful, they should sell their ideas to private enterprises and raise their capital that way. But, I’m pretty sure that no one with $310 million laying around thinks this is a good idea.

  • avatar
    K5ING

    I’ve always like the idea of the Carbon purpose-built police car, but I would have done it differently.

    I would have bought the tooling for the last “real” Caprice from GM (or today, maybe the Panther tooling from Ford)and modified the drive train, interior and suspension for police work.

    Raise the suspension a couple of inches for ground clearance, do the interior like Carbon wanted, install the BMW (or similar) mid-sized diesel, then installed a small diesel APU to run the electics and A/C for the many hours when the car sits and idles.

    That’s alot of modifications, but it would have to be easier and cheaper than designing and manufacturing a whole new car.

    • 0 avatar
      Lokki

      +1

      The idea that company with no car building experience is going to build a car that gets exceptionally heavy duty use from scratch almost HAS to be a scam by definition. If they were using a Panther and improving on that base with specific purpose modifications – that might be believable.

      I think it was a brilliant touch of the scam to aim it at police cars…. something for everybody that way-

      Fuel efficiency for the eco-babies and better police cars for the gun is gooders: the whole political spectrum covered!

      Someone slipped an evil thought in my head through the comments above – why NOT use Prius’ for most patrol duty? Are they not durable enough? For pursuit, the radio has ruled the fast car for decades, and no policeman seems to fransport someone who has been arrested without backup anymore, just bring back the Paddy wagon for that purpose….

    • 0 avatar
      Joe McKinney

      From what I have read, Carbon Motors has been around since the 1990’s and their orginal idea was to buy the old GM B-Body tooling. GM said no and Carbon went on to develop their current platform.

      I do not believe the Carbon E7 is a scam. While Carbon has not started production and likely never will, they have invested a lot of time and money to create a running proof of concept and to secure a production facility. As with Tucker, Bricklin and Delorean, Carbon appears to be a sincere effort that is overly optimisic and seriously undefunded.

  • avatar
    AMC_CJ

    Was a good idea on paper, but in the application……

    A lot of precincts didn’t bite. A good friend of mine is a police officer, they came around to their precinct, showed off the car. Supposedly the “garage” (maintenance) seemed to really like it and pushed it, but the cheif did not. Now, being someone who works in the fleet-maintenance business myself I wish I could of seen the mechanical end myself. However, I don’t do government work anymore.

    Regardless, their city is infested crime and their chief’s number one concern seems to be “image first”, so they’ve ordered a batch of Tauruses (not she SHO model).

    • 0 avatar

      From the perspective of an elected person in my tiny village, with a 21 person force, two cars on the road 24/7, there is NO WAY that we’d end up with this car. Price alone would dictate a modified “normal” car from a “big three” maker. Unless they can prove the car lasts four times as long, which for cop cars is tough, you can’t sell it in a political environment. Cop cars are disposable. They are driven by folks with no ownership interest, at all times, in all conditions, often in pursuit or in a way you’d never use your car. While the other driver will ALWAYS be at fault (at least that is what the police report will read) cop cars get whacked a LOT….longevity of mechanicals isn’t usually the end game.

  • avatar
    CJinSD

    The accepted construct that real business models need DOE loans to succeed is either false or utterly repellent.


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