The U.S. Department of Energy on Friday started an auction on its loan made out to struggling electric car startup Fisker Automotive back in 2010. The DOE is still owed $168 million from the $192 million loan, which was originally awarded to Fisker under the government’s advanced-technology vehicle manufacturing program, though any sale is expected to be at a discount.
The DOE said it planned the auction after "exhausting any realistic possibility" that Fisker could repay the loan. Prospective bidders had to offer at least $30 million to qualify, with 10 percent down due with the bid, sources revealed to Reuters.
Eventually restarting production of Fisker’s sole model, the Karma extended-range electric sedan, could potentially add hundreds of millions more to that bill. Fisker’s other debts are alleged to include around $80 million to suppliers and around $10 million to Finland’s Valmet Automotive, the independent manufacturer that previously built the Karma.
The auction of the loan is expected to be a lengthy process but already there has been some interest. The first formal offer for Fisker is alleged to have come from a German consortium, Fritz Nol, which is said to have offered just $25 million along with the promise to start production of the Fisker Karma in the U.S.
Despite it being close to 15 months since Fisker last made a car, the company is yet to announce bankruptcy and remains confident a new investor or even a potential buyer can be found. A winning bid of the government loan would provide the buyer with a key stake in Fisker though the size of the stake is not clear.
In addition to Fritz Nol, a group led by auto industry veteran Bob Lutz, another led by Fisker’s own founder Henrik Fisker, and Chinese automaker BAIC have all expressed interest, though none have formally announced their intentions.
Stay tuned for an update.