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02-07-2012, 01:13 PM | #1 |
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Bye Bye - Fisker
http://www.slashgear.com/fisker-fund...ayed-07212377/
Fisker funding frozen: Project Nina delayed "Luxury eco car company Fisker has been forced to freeze work on its second vehicle, Project Nina, as well as make a total of 66 redundancies as government loans dry up. Fisker, which began delivering Karma plug-ins back in July 2011, faced renewed US government attention with its launch schedule delays, GigaOm reports, with the Department of Energy suspending a $528.7m loan agreed in 2009 back in May 2011. The terms of the loan mandated certain milestones and timescales that Fisker needed to meet in order to claim each part of the cash, and with the shipping schedule not going according to plan there’s now a mandatory renegotiation. So far, Fisker says, it has received $193m of the total loan and is “renegotiating some terms of the DOE agreement” as well as continuing to “pursue alternative funding sources.” It’s not the only recent bad news for Fisker Automotive. The company was forced to recall 239 Karma cars earlier this year, after battery issues spotted in December became more widespread. Fisker had originally planned to push out Project Nina in 2012, though now says it will focus on the Karma this year and return to the second model at a later point, timescale unspecified. The company has already raised around $850m in private equity funding."
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02-07-2012, 01:17 PM | #2 |
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How about "Bye Bye - Misleading Thread Title"??
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02-07-2012, 01:21 PM | #3 |
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^Can't say I, or many people out there, would miss them in any way if it was "bye, bye"........Just think about how many other areas that money could be spent on.
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02-07-2012, 01:24 PM | #4 |
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They were loans.. not grants. If you want the US government to get their money back you should be cheering Fisker, not jeering them.
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02-07-2012, 01:44 PM | #5 |
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If they were unsecured loans, then they might as well be grants, gifts, or giveaways.
Government loans make people think as you do, that there is a likelihood of getting the money back... when the government rarely operates the way the surface language appears to suggest. Solyndra was "loans", too, IIRC... and that is GONE, and nobody even knows where. Most of the auto bail-outs were unsecured loans, which were never meant, or expected to be paid back... but the public heard the word "loan". Meanwhile the bond holders, who actually DID have standing and expectations of claim during bankruptcy, were tossed aside like nothing. Especially Chrysler, that was handed over to Fiat and the Government/union interests, while the bond-holders got pennies on the dollar, if ANYTHING, when they were supposed to be first in line. A bond is secured by definition, and is not the same thing as a stock. |
02-07-2012, 02:03 PM | #6 | |
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Bolded parts are incorrect. Solyndra money was spent on capex needed to build facilities. I'm not arguing that it's largely irrecoverable. The Auto loans were secured and were meant to be paid back. Treasury still owns GM stock which was swapped for the debt. Bonds are not secured unless specifically stated (which is rare). They do have a higher priority than stock. In this case stockholders got even less than the bondholders. As for the Chrysler situation. The LOAN holders were secured. Govt thuggery prevailed and the majority of the loan holders agreed to being subordinated by the other stakeholders. |
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02-07-2012, 03:37 PM | #7 |
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Did anyone think that:
a. Fisker was actually going to make good on the milestones/timescales in order to qualify for the full amounts of the loans. b. If they, by some miracle, made good on the milestones/timescales they would actually be able to repay half-a-billion dollars in loans back to the government this century? |
02-07-2012, 03:44 PM | #8 |
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I still believe that GM, Chrysler and Ford (who took low-interest loans) needed some kind of help since the Japanese, German and Korean governments have been subsidizing their car makers as well. Giving a big stake to the unions wasn't the way to do it though.
However, Fisker was doomed to fail from the start. Who has the money to buy a six-digit car from an unknown maker? Stupid for our government to give them a nickel of aid. |
02-07-2012, 04:11 PM | #9 | |
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Quote:
Bonds are sold on the principle that they are secured by company equity, at a fixed, relatively low rate of return. That is why they have low rates of return, because there isn's supposed to be as much risk. In bankruptcy, the bonds are in line to be repaid first, either in a corporate buyout, or in liquidation of assets. Chrysler, and some GM bond holders were kicked to the curb, and lost out, as the government, the unions, and Fiat split up the company. That was unprecedented. GM stock has not done well, and the government recently updated their monetary losses in that bail out, because of the lack of stock performance. Those bail-outs were done full well knowing that those "loans" were beyond high risk, and a high fraction were never counted on being paid back. They knew it before they did it... and played it off as a patriotic move to preserve an american industry, despite the losses they knew they would incur. A loan with no reasonable expectation of repayment, becomes a grant, giveaway, or bailout, even if there is language that claims an expectation, they knew it was nothing more than lip service when they wrote the agreements. It was the same attitude for Solyndra, GM, Chrysler, Fisker, or the Community Reinvestment Act regulations forcing banks to extend mortgages to people who the government, and the banks BOTH knew could not repay them. The banks had a government-held gun to their heads, and tried to pass the bad paper off as securities to Fannie and Freddie, who are backed by FED printed cash. Lip service is still just lip service, it doesn't excuse them from knowing what they were doing before, and as they were doing it. They can call it a loan, and wink as it is lost. They count the lending as spending, and whatever small fraction they might get back, is treated as new revenue, not as return, and they dis-regard the loss, as they KEEP SPENDING at faster and faster rates. Nobody can be careful about where that money is going, or how they'll get it back, at the rate they are spending. They are throwing printed dollars around. If it were any faster, it would be random. The tax dollars are in the wind, and you can see the deficit spending, and the debt climbing at a higher rate in the last three years than EVER before, and it was setting records before that, too. The FED notes are printed and continue to be printed, as the FED buys treasury bills, to service that debt with little actual value behind it, and you can see the inflationary pressure at the fuel pump, and at the grocery store, as your money has less value, too. They can call it whatever they want. The policy makers are experts at code language, and spin control. The proof in the pudding is, that they have been giving the value of american's time, talent and effort away far faster than the people can provide it... Now they are giving away the time, talent, and effort of generations yet unborn. And they KNOW it. And we are just seeing the beginning. When the printed greenbacks gain velocity out of the bank vaults that they are being held in at zero percent cost to the banks, while consumers pay higher credit interest rates, and get barely more than zero savings interest rates... Once that cash gains velocity, nobody who doesn't see it now, will know what hit them. |
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02-07-2012, 04:39 PM | #10 | |
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Who has the money? Well, I guess all the people on the waiting lists to buy the Karma. |
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02-07-2012, 04:48 PM | #11 | ||||
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02-07-2012, 05:07 PM | #12 |
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I am a taxpayer, and a bill payer. Tax payers funded all of this, and our representatives are supposed to be our delegates sitting at the table, and they've sold not only us out, but our unborn grandchildren.
I see my money being sucked away, as I work harder. I watch current events closely, and I have a brain. It is not difficult to see the results, if you watch what happens. Few ever investigate where things go, and what investigations are done, never seem to see results... yet the investigations still cost the taxpayers money. The government says that the losses on the auto bail outs are up-rated. Ok. Fisker misses the mark, and can't repay what they've been lent. Ok. Old GM and Old Chrysler are saddled with the bad debt, and liquidated, new GM and New Chrysler/Fiat are now bright and shiny clean. Ok. Solyndra goes belly-up, and there are reports that the government knew they were going to, yet still lent them more money than you and I put together could spend in our whole lifetimes. Oh, nobody knows where it went. We're bailing out the EU... no plans announced on how they can EVER pay it back. What about this is less than obvious? What about a 15 Trillion Dollar Debt, 120+ Trillion in un-funded future liability, a thousand days without a federal budget, and nearly half of every dollar spent is borrowed... with no plans to cut back, or repay... What is not clear? Are you not paying attention to how much your lunch cost you today? Or the gas price that has gone up 40 cents in the last 10 days or so?, and is more than 100% higher this election year than the previous presidential election year? Are you not paying attention to somehow there being fewer total jobs in the economy today, than ten years ago, despite a 30 million more people in this country, yet somehow the unemployment rate is decreasing, as people rolling off the unemployment eligibility regs are just no longer counted as existing? If you don't want to pay attention, that is fine. And if you know bonds so well, then please do explain what the purpose of a fixed return bond is, and how it is different to shares of stock, and how a bond ISN'T debt that the company owes the bond-holder. |
02-07-2012, 06:36 PM | #13 |
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I have been saying for ages that I don't know why we wanted to give Fisker money. Giving it to other companies would be better.
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02-07-2012, 06:38 PM | #14 | |
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I dont want to argue your opinions. You have every right to them. I am just trying to correct a lot of your fallacies, which is all I have focused on.
Quote:
This is what a capital structure will look like in terms of preferential treatment in a bankruptcy. Revolver (usually secured by a first lien on working capital, second lien on assets) first lien debt (secured by first lien on assets, second lien on working capital) second lien debt (secured by second lien on assets and working capital) bonds (unsecured debt, claim on the company) trade claims (unsecured debt, claim on the company) preferred stock common stock with the exception of the bolded part your priority decreases as you move down the ladder. just because a bond is a debt that the company owes the bond-holder does not mean they get back 100% or preferential treatment over other equal ratable claims. |
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02-07-2012, 07:44 PM | #15 |
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Thanks for the clarifications.
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02-07-2012, 08:00 PM | #16 |
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02-07-2012, 08:33 PM | #17 |
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The funny part is this actually shows government working if they decide not to give them the loan b/c they are not living up to their end of the bargain. I don't see why it would upset anyone.
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02-07-2012, 09:28 PM | #18 |
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02-07-2012, 09:46 PM | #19 |
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Personally i'd much rather piss away money to companies like this than all of the open bid contracts that Halliburton or anyone else is getting overseas.
Thats just my 2c |
04-02-2013, 08:58 AM | #20 | |
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http://online.wsj.com/article/SB1000...59688928.html#
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04-02-2013, 09:40 AM | #21 |
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Chop it up, sell it off to Tesla, and get what money you can back. So long to a bad investment. Let us stop supporting moronic start ups with half assed business models.
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04-02-2013, 09:42 AM | #22 |
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Yeah...Tesla has the right idea...Fisker...not so much. I wasn't too fond of some of the motivation behind Fisker either way. However I am not too fond of these Chinese companies buying up US government funded technologies either...
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04-02-2013, 09:46 AM | #23 |
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yeah, that part sucks... and you can bet the leeches at Fisker are using that angle hard. Give us money or we will sell to China..
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04-02-2013, 09:55 AM | #24 |
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04-02-2013, 01:20 PM | #25 |
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I wanted to see the Karma with the ZR1 drivetrain... Fisker has come up with some great designs - even the makeovers he gave to the old M6 and SL65.
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