Under pressure from the US Department of Energy (DOE) to re-pay nearly US$200 million ($190 million) in federal government loans it received back in 2009, Reuters reports that Fisker Automotive has had attorneys draw up bankruptcy documents to file for Chapter 11 of the United States Code in the coming days.
With Fisker’s next DOE loan payment reportedly due on April 22, and worth around US$10 million ($9.5 million), Reuters reports that Fisker has hired lawyers to advise on a possible bankruptcy filing at the end of last month.
Although the 2009 DOE loan, awarded to Fisker by the Obama administration to fund advanced vehicle development, totalled US$529 million ($504 million), the hybrid manufacturer reportedly only used $193 million ($184 million), earmarking the remainder for the planned Fisker Atlantic model.
Last week, Fisker let 75 per cent of its workforce go in "a necessary strategic step" to maximise the value of the company's core assets, resulting in a law suit being filed.
Reuters reports that while Fisker has the DOE loan repayment to make, the company has raised US$1.2 billion ($1.1 billion) from investors – including actor Leonardo DiCaprio – in addition to having "at least" US$30 million ($28.5 million) in cash and over US$15 million ($14.3 million) coming as a result of settlement with now-bankrupt battery maker A123 Systems over the supply of defective battery packs.
Industry journal Automotive News reports that of Fisker’s remaining workforce about 50 executives have been trying “unsuccessfully” to attract buyers from China and Europe in an attempt to avoid bankruptcy. Fiat, and its umbrella Chrysler Group, are rumoured to have showed interest.
Further to its woes, California-based Fisker has not produced one of its US$100,000 ($95,000) luxury cars since July last year, and only last month its executive chairman and co-founder Henrik Fisker left the business citing “several major disagreements” with Fisker Automotive’s executive management on their business strategy.