Another auto maker that took Department of Energy money has gone bust. Vehicle Production Group, a producer of special vans designed to meet the needs of the disabled, has suspended operations and is due to be sold, according to Automotive News.
Former CEO John Walsh told AN that the move came after the company fell below a mandated cash threshold set by by the government.
“It was the right thing to do for the employees,” Walsh said. “Many people were going to continue to work there but not be paid, and I couldn’t sleep at night having that happen. It was the best financial decision to suspend the business.”
Walsh stressed that bankruptcy was not in the cards and that the company would likely be acquired by one of two companies, strongly hinting that AM General would be the eventual partner. AM General currently builds VPG’s MV-1 van at their plant in Indiana. So far, VPG has built 2,500 vans and has a backlog of about 2,300 orders. The MV-1 was powered by a 4.6L Ford V8 and used a modified London taxi platform.
VPG applied for the $50-million dollar loan as part of the Advanced Technology Vehicles Manufacturing program, the same one used by companies like Fisker. VPG was said to be using the loan to implement CNG technology on their vehicles.