When former TTAC Editor-in-Chief and now Editor emeritus Edward “Op-Ed” Niedermeyer wrote an op-ed in the Wall Street Journal and warned that GM’s center of gravity shifts more and more to China, GM’s retired multi-role fighter Bob Lutz reamed Ed via Fortune. Now, Bob Lutz himself appears to be an accessory in a deal that transfers U.S. government-financed technology to China for pennies on the dollar. Says Deepa Seetharaman, in-house alternative drivetrain expert at the Reuters Detroit office, in her in-depth article:
“VL Automotive and China’s Wanxiang Group are looking to gain control of Fisker through a prepackaged bankruptcy. This comes alongside a separate push by investors in Europe and Hong Kong, including billionaire Richard Li, to buy out the U.S. Department of Energy’s position in Fisker.”
Here are the players:
Fisker hasn’t made a car since last July, and hasn’t built many before. Fisker hired bankruptcy advisers after firing most of its workforce.
The U.S. Government awarded Fisker a US$529 million green-energy loan in 2010, of which Fisker collected nearly US$192 million until 2011. Then, he government froze the loan.
VL Automotive is a venture between Bob Lutz and his partner, industrialist Gilbert Villarreal, hence the VL. At the Detroit auto show this year, VL Automotive showcased a car called the VL Destino, “which combines the shell of a Fisker with the guts of a Chevrolet Corvette ZR1,” says Reuters. The car is said to cost around $180,000.
Wanxiang is China’s largest automotive components manufacturing company. Wanxiang successfully bid for Fisker’s battery supplier, A123 Systems after the company went bankrupt.. This week, a judge approved the bankruptcy plan for A123.
The government loan is in the way of selling Fisker. “Prospective buyers have been unwilling to assume the obligations spelled out in the loans,” sources told Reuters.
According to Reuters, a deal is being negotiated in which a Hong Kong finance group would buy out the government’s loan, most likely at a steep discount. Then the assets could be sold to Wanxiang and VL. Especially independent Chinese automakers need to export to fill their idle capacities. To be able to compete, they need foreign technology.