Another DOE Backed Auto Maker Bites The Dust

by Derek Kreindler

May 9th, 2013 11:18 AM

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another doe backed auto maker bites the dust

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.

#MV-1 #Van #VehicleProductionGroup #Vpg

Derek Kreindler

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9 of 69 comments

Chocolatedeath on May 09, 2013

Ironic or not I had the pleasure of sitting in one of these this morning. Funny after not knowing what the hell it was until after the post about taxi's the other day. I was getting my morning joe and saw the driver (that I actually knew) from another Social Work job I had in the past. He let me sit in it and showed me around it. I have an old phone so I didnt get to take pics. It seems to be that it serves its purpose very well. Depending on the configuration you can have as many as two wheel chairs and two people or one wheel chair and three people. I see the need and hope that who ever buys them out makes some adjustments for fuel economy. Maybe Penske will look into it, he seems to think different. Or better yet Maximum Bob..lol LT1 engine anyone?

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Hummer on May 09, 2013

I wonder why there was a backlog, this particular building has the ability and capacity to produce 60,000 vehicles a year. Half of the building houses the system for a previous vehicle, but it still makes no sense that they couldn't make enough.

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- FAHRVERGNUGEN on May 09, 2013
  
  The backlog only existed because the line was on "slowdown" since late last year, to ostensibly allow for retooling for the 2013 year. Also gave an opportunity to move the inventory of completed vehicles. Building 60,000 cars a year was a good goal. Just need buyers for 62,000 vehicles. What was needed was VC to get the plant running again and help book the $98,900,000 of gross sales for the 2,300 units in pre-order.
  
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- Hummer on May 09, 2013
  
  @FAHRVERGNUGEN The facility the vehicle was built in wasn't designed for the MV1, it was designed for the H2. I have no idea the targeted amount of vehicles they wanted to produce was. The problem is however, AM General still has everything from the H2 assembly in half of the building just setting, it was never dismantled but rather moved, that means that the plant had the ability for possible 20-35k vehicles. But on that same note, for a vehicle that sells so few vehicles why would they need to retool, as it had only been open maybe 2 years, that in itself is bad bussiness practice. Maybe they needed to correct issues, but to retool? Seems like someone is trying to buy time.
  
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- Peter E. Puffington IV on May 09, 2013
  
  @Hummer But the MV1 was specifically designed to use a bunch of the H2's tooling if I remember. This thing intrigued me and I had been rooting for it.
  
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- Hummer on May 09, 2013
  
  @mkirk Hmm, that's pretty cool, I never knew that, it would make financial sense though, the H2 had just been retooled 2 years prior to it's demise, and GM was putting zilch into its marketing, even though it's gas mileage has improved with the new setup to around 15-16(I've heard on highways some have gotten consistent 18 or so(both of mine are prior new style)) The interior on the new one also got an extreme upgrade, went from low quality to high quality with the switch. So those tools were fresh Wasn't cheap, like I said that seems like a perfect oppurtunity for someone to have AMG build an automobile. Just a side note I always found funny, the same facility was given the award for most "environmentally friendly" manufactoring plant in the WORLD.
  
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- FAHRVERGNUGEN on May 10, 2013
  
  @mkirk Hummer and mkirk - the MV-1 was certainly being built on the old H2 line. But if you can believe it, the body of the MV-1 was actually taller than the H2, which necessitated a LOT of changes to the clearance on the line. All because the floor of the MV-1 is so much lower than the H2, which had much more ground clearance. It's a fascinating plant to see in operation. Clean, colorful, with bodies suspended just like a cool ride at an amusement park. Lets hope someone has the $$$$ to push the big start button again.
  
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Peter E. Puffington IV on May 09, 2013

And is it just me, or does the front end look like a Ridgeline?

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Bill mcgee on May 10, 2013

I'm glad to read all this because I've seen a number of these in Houston, and actually walked around them trying to find some clue as to who made it. I thought it looked like more of a bloated Honda Pilot . I didn't find it all that unattractive in the flesh and it's more SUV like than a van.

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