Fisker Loan, A123 Battery Grant Questioned by Senators

Two Republican U.S. senators questioning U.S. assistance to luxury plug-in carmaker Fisker Automotive Inc. asked the Energy Department for more information about its $529 million in loans to the company.

Senator Charles Grassley, an Iowa Republican who is his party’s ranking member on the Senate Judiciary Committee, questioned an Energy Department website posting saying the agency’s loan to Fisker would result in the equivalent of 30,000 fewer cars on U.S. roads. He also asked why the U.S. would grant a loan to a company part-owned by the sovereign wealth fund of Qatar.

“It appears that Fisker has experienced difficulty creating American jobs and questions have been raised regarding the decision to loan Fisker over half a billion dollars of taxpayer money,” Grassley and U.S. Senator John Thune, a South Dakota Republican, said in a letter sent today to Energy Secretary Steven Chu.

The senators sent the Energy Department questions about the Anaheim, California-based Fisker in April and said today they weren’t satisfied by the agency’s answers.

The company was approved for $529 million in U.S. loans in 2009 to develop technology for its first model, the Karma, and revamp a closed General Motors factory in Wilmington, Delaware, to build a second model to be called the Atlantic. Fisker drew down about $193 million before its access to the funds was suspended last year, owing to delays with the Karma.

Chief Executive Officer Tom LaSorda said in April that the company may build the Atlantic overseas instead of in Delaware.

“As Fisker works through those issues and incorporates lessons learned from the production of the Karma, the department is working with Fisker to review a revised business plan and determine the best path forward so the company can meet its benchmarks, produce cars and employ workers here in America,” Damien LaVera, an Energy Department spokesman, said in an e- mail.

To contact the reporters on this story: Angela Greiling Keane in Washington at agreilingkea@bloomberg.net

To contact the editor responsible for this story: Bernard Kohn at bkohn2@bloomberg.net