Fox News attacks U.S. Department of Energy loans to Fisker and Tesla

Posted: Sep 30, 2009
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Fox News attacks Tesla and Fisker

In the past, egmCarTech has reported on loans and funding that Tesla Motors has received from the government to establish facilities in Michigan and California, and now, Fox News has also reported the on the same. Well, kind of.

Hybridcars.com is reporting that, “According to Fox News, the US Department of Energy threw away nearly $1 billion in loans to Fisker Automotive and Tesla Motors””two Calif.-based auto startups trying to produce the next generation of American-made energy-efficient cars. On several of its shows, including America’s Newsroom and Your World, Fox News criticized the loans because Fisker and Tesla currently produce expensive cars that are made in Europe.”. Martha MacCallum of America’s Newsroom, a Fox News program, also said. “Listen to this. The US government is making a $529 million loan to a small car company that happens to be backed by former Vice President Al Gore. Get this. It’s called the Karma. It’s a hybrid. It’s built by Fisker Automotive. The price tag for this greenmobile is about $89,000.”. and during that same segment, the text on the screen read, “Americans Fund Car Co That Will Create Jobs…In Finland.”.

For a network that prides themselves on their claims of being the only truly ‘Fair and Balanced’ news network, the above could not be further from treatment that even almost resembles fairness or balance. Even less fair balanced though is the following statement from Fox News contributor Stephen Moore: “I think most of the people watching this show, I think, would question the wisdom of the Department of Energy giving out these grants in the first place. But I think the vast, vast majority of Americans would say, at least if we do it, find an American company that’s going to employ American workers to do this.”.

Now for fairness and balance:

The Tesla Roadster is indeed manufactured in England, and components of the Fisker Karma are certainly made in Finland. The DOE loan to Fisker is for engineering work to be conducted at the company’s Pontiac, Michigan and Irvine, California, Headquarters. The research that Fisker plans to do will eventually culminate in the annual production of 75k to 100k plug-in hybrids beginning in 2012. The new Fisker vehicle will also be priced much more modestly than the Karma; about $45,000.

Tesla’s funding is to support production of the Model S, which is expected to begin production in 2011 and sell for about $55,000, with production reaching 20,000 vehicles per year by the end of 2013. The SoCal location is expected to create 1,000 jobs, while another Tesla project, also using the funding, will employ 650 in NoCal, at a facility that will manufacture battery packs and drivetrains.

In actuality, these loans were responsibly given, and are perhaps critical in getting America on the cutting edge of hybrid and electric vehicle technology, though that is not what the fair and balanced folks at Fox would have you believe.

- By: Stephen Calogera

Source: HybridCars


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  • emma

    Karma is backed by Al Gore. And it is being built in Finland although some parts will be produced here and shipped there

  • Pat

    The whole network is made up of a bunch of idiots. I don't get how they are still in business and who actually watches them

  • CB

    I agree that government funding business developments that are not cost effective is a waste. It simply spends our money for us by force through taxation or the inflation from the money they have to print.

    Want shitty electric cars? If their is enough demand there is no need for wasting tax payer money. The problem is they are not cost effective when compared to gasoline, so the demand is low.

  • zermatt

    Total day: FNC: 398 | CNN: 148 | MSNBC: 140 | HLN: 166

    Prime: FNC: 689 | CNN: 184 | MSNBC: 194 | HLN: 230

  • zermatt

    Al Gore's involvement is almost enough to put me off of this company, but I like their designs and I am intrigued by their technology.

    Funny how Al Gore is in favor of limiting executive pay, but wouldn't restrict his return on investment.

  • cwill

    Even after reading this short and direct to the point article, that corrects the mis-education from FOXnews (note the lower case in news) …it never seems to amaze me that the FOXnews fans don't care what the truth is.

    FOXnews and its followers are the true SOCIALIST! (dont agree) show me one person that say or think any different than the next person in that group, JUST ONE!!!!

    Per the ratings, FOXnews is the lying, no good main stream media

    As for electric car demand …once the design is up to par and the performance is there, demand will follow. (Both myself and my boss have deposits in for the Karma)

  • JVC

    It seems to me that this article makes a bigger deal than necessary from what seems to be a difference of information between this forum and FOXNews. Clearly, based on the number of negative comments, there is a higher percentage of FOX haters here. Sad. You're a miniscule minority.

    Facts about Fox are clear and the MAJORITY of viewers, BY A UNQUESTIONABLY LARGE MARGIN choose this network.

    I sense a lot of resentment from the haters.

  • http://www.fiskerbuzz.com FiskerBuzz

    What is key to note here is that 68 percent of the Fisker loan will be used for the lower-priced Fisker Nina, as stated in the September 22 DOE press release.

    Project Nina will be assembled in the United States.

    With regard to the remaining funds — which will be used for the production of the more expensive Fisker Karma — the engineering work “will be conducted at Fisker's Pontiac, Michigan office with support from its headquarters in Irvine, California,” and that “[w]hile the final assembly of the Karma will be done overseas, more than 65 percent (based on cost) of the parts required for Karma will come from U.S. suppliers.”

    The DOE has concluded that “[t]he combined projects are anticipated to create thousands of jobs in the U.S. and provide substantial support for domestic parts suppliers saving or creating approximately 5,000 jobs.”

    For those interested, we also have the full transcript of the Fox segment here:
    http://fiskerbuzz.com/forums/showthread.php?tid=26

  • Range802

    This is the first political stance I've seen eGM take in any of their articles.

    To Stephen Calogera: if you want to be truly 'fair and balanced' as you claim to be in this article contrary to the commentary by FoxNews, perhaps you should have outline the fact that while components for the vehicles are made here, final assembly is in Finland. Fox chose to focus on the later completely (according to your article, I did not see the broadcast so I do not know for sure if they mentioned the initial process in CA) while you chose to say:

    “In actuality, these loans were responsibly given, and are perhaps critical in getting America on the cutting edge of hybrid and electric vehicle technology, though that is not what the fair and balanced folks at Fox would have you believe.”

    - It is your OPINION that these loans were given responsibly, not fact
    - It is your OPINION that the funds will flow directly to workers in CA, and not support work overseas (who is keeping track of this? certainly not eGM, and I doubt Obama's administration has a “task force” to keep track of it)

    You tried to sell Fox's report as an attack, although they simply strive to give the public information that can not be found on the other networks (or should I say the other State-Run Media Outlets).

    Please, keep your comments completely objective or open-ended, asking users to comment on their opinion. I started checking this site on a daily basis for my auto news for various reasons, including the quality of the website itself, the quality of the articles and most importantly the lack of bias towards a political party or automaker. Head over to autospies.com and you will be a pariah if you don't praise BMW. I dont want this site to be corrupted in the same way, it would be a shame.

  • Reality Strikes

    zermatt….

    Limiting exec pay has absolutely nothing to do with Return on Investment which is a risk reward arrangement. Not defending Gore here but if we continue to give every kid a trophy in little league just for playing (not for actually winning) then executive pay will continue to be just like the UAW. Something for nothing is not workable long term, risk reward is!

  • zermatt

    My compensation plan is heavily incentivized. If I achieve my goals I get paid well. If I fail to achieve then I don't. My success at hitting my targets is what separates my compensation from my peers. At my company not every kid gets a trophy and it is presumptive to assume that that is how it works everywhere. What I (and many others who are heavily inventized) do to earn our compensation is NOT something for nothing.

    If you believe that risk reward is a function of investment only and that it has no place in other lines of endeavor you would be wrong. Playing it safe is what has caused other businesses to falter and be acquired or fade away.Being bold in business is what draws investors to companies to invest in. If you want safe – invest in treasuries, but if you want a good return you seek out those industries and companies that are making a difference. And for making that difference, producing profitability and getting a good ROI or ROE I expect to be well paid. If you take away the incentive to excel you will have a stagnant business climate and life will be like it was in the late seventies and early eighties. If you are not ware of what that period of time was like – it really sucked.

    Being in the financial services industry, I fully understand ROI as that is one of the measures that my compensation is based. My results have to lead to an outcome that improves the value of the capital that has been allocated to me. Oh, BTW, I not only work here, but I have an ownership interest. My efforts also go to the increase in the value of the company. Do you have a significant ownership interest in the company that you work at?

    I may be wrong, but based on your comments, I am guessing that you don't have any incentive portion to your compensation and because of that you would be predisposed to want to see those that earn more than you brought down to your level.
    Don't envy those that have invested in their careers and have taken on greater responsibility to be well compensated. It makes you look small.

  • Gekke Henkie

    1st: It is a LOAN! Get it? Quotes like “threw away nearly $1 billion in loans” are non-sense. Even more so calling it a 'Grant'…(?). They LOAN money and get it back (with a little interest).

    2nd: Why are Americans so obsessed with 'American jobs'? Europeans are concerned about 'Global warming' and the environment is a Global thing. It really doesn't matter who funds what/where IMHO, as long as larger powers/economies fund where possible and help the environment from getting even worse. Let those jobs be done where ever it is smartest for that type of technology/economy. Who cares if a guy in China can buy food for his kids, or a guy in the US can do that: every human being has equal rights in that respect, no matter if we call it aid, loans, etc. Please stop being so Nationalistic ('our people' first approach). Sorry for my rant, I had to get that of my chest.

  • GMfan87

    Stick to the objective news guys. I don't read egmCarTech for your opinion on Fox news.

  • FiskerAutomotive

    FOX News did all Americans a disservice by misrepresenting the facts. The key messages here are that all of the funds must be spent within the US that they will create or save at least 5,000 American jobs and ultimately prevent the import of some 43 million barrels of oil. FOX also called Fisker Automotive a Finnish company, when in fact it is based in Irvine, California and has already supported, with private funding, hundreds of US jobs through the worst period the auto industry has ever faced.

  • http://www.egmcartech.com egmCarTech

    I highly doubt Stephen meant to be bias and opinionated, but I'll let him take car of his own business. I have asked him to comment and clear this up and he'll be doing it later today… stay tuned.

    Omar Rana
    Editor in Chief

  • Reality Strikes

    zermatt

    Well unfortunately you are pretty wrong, 100% of my pay is incentive. Don’t take my comments so personally, that’s the exact kind of condescending attitude that gets in the way of American ingenuity and progress.

    When I’m talking about the trophy just for playing, you know exactly what I’m talking about. I too have been on ‘The Street” and in the financial services industry for 30+. The money coming off the top is mind boggling and you know it.

    Why should CEO’s of ‘losing’ companies and banks get bonuses in the millions? How do politicians enter average and leave rich? They do it on the backs of everybody else. So stop crying and keep things real, it’s not always about you. If I worked as CEO for XYZ Company for 2 years, did a crappy job and got paid $22 million to leave I wouldn’t turn it down either but it still doesn’t make it right.

    The “Free Trophy” is now part of the American landscape, if you don’t believe me just ask the 72 year-old retired Little League umpire that quit over it last year. If your deal works the way you say it does then more power to you. But putting others down to justify yourself hasn’t been working for you so far, why try now?

    Do you really want to force American companies that live in a world of globalism to only use these kinds of govt programs to only create jobs in America. Or do you want us to own the technology and engineering? If it’s the former then maybe you think nationalized socialism is the way to go.

    I don’t think so, and Gore probably doesn’t either. By the way, it is a LOAN you know. Maybe you could be mad at Warren Buffett for investing and creating jobs at BYD over in China. Or Harvard, Yale and Princeton for doing JV campuses in other countries, they get govt money too you know.

    Yes, it does sound silly just like you worrying about exec pay because they’re not talking about you. It’s about the laundry list of Fortune 1000 CEO’s and the TARP taking CEO Bankers who still want it off the top. Don’t be so sensitive…It makes you look small and I think you’re probably a pretty good guy. A little full of yourself but still probably a pretty good guy.

  • Stephen Calogera

    It is not my OPINION that funds will flow to CA workers, it is a precondition for receipt of the funds (please see the comment post by Fisker Automotive). I agree that it is unfortunate when certain media outlets become agenda oriented and take on causes. As a contributor to a blog devoted to the auto industry and the happenings pertaining to it, I thought it my duty to clarify a misrepresentation of facts pertaining to the industry we all love, that was used as fodder for political purposes. This is not a political site, nor do we intend that it become such. I did not come on here to advance any political stance or agenda, all i did was point out the shortcomings of a news network, and played on their slogan a little bit. If anything, my article shows the unbiased tone that we all wish to see egmcartech maintain, in that it corrected the short reporting of another media outlet with regards to the auto industry so, in order to keep auto news UNBIASED, I clarified the case with facts that were omitted (intentionally or unintentionally) by Fox.

  • zermatt

    RS,

    I accept that I may have been wrong about you, but you have to admit that you are making something of a populist argument related to compensation.

    We are not that dissimilar in our positions – really, but when government begins to restrict pay in one area it could spread to others quickly. I like it best when government stays out of business. Shareholders should have the real say on executive compensation and like politicians, directors should have term limits. Directors are not doing their jobs when they allow CEOs to be compensated for losing years and exit packages fall into the same category. The fact that shareholders (institutional shareholders in particular) don't make waves is a business problem and not a governmental issue.

    I am as much against the rise of mediocrity as the gold standard as you are. Schools, sports organizations and youth groups are more concerned about hurting someone's feelings than they are presenting the reality that competition is what the world is all about. The populist sentiment that is permeating the county’s mood and that will stifle the county's ability to exit the recession sooner than later. I have little interest in people that won't help themselves, but complain about those that do. I don't have to justify myself to anyone, I want people to take responsibility for their choices and not complain or act like a victim.

    If you had the chance to read any of my other posts you would know that I am all about the global economy and my company has operations in Asia, Latin America and Europe. We are investing a huge amount of money in China and Latin America and we expect it will pay off handsomely in the future. It is my position that the longer the country fails to recognize the global reality the worse off the country will be economically. My comment with regard to Fox had everything to do with available time for TV. I don't watch any of the cable news networks.

    You assume that my compensation plan won't be affected by governmental fiat and I hope that you are right as the Fortune 1000 covers a lot of ground. If we evolve into a nation where lawyers, lobbyists, professional athletes and entertainers are the only people that can have large incomes we will be finished as an economic power. I would, however, be a fool to not let my representatives in Washington know how I feel about government involvement when it comes to this. And I see no harm in letting others know how I feel about it.

    BTW, your condescending tone is what set me off and led me to the small comment and since you continued with that tone, you are still looking small – so we are equal. I am certain that you are as equally a good guy as you believe me to be. It is nice to have someone to discuss topics with and I hope that we will have the opportunity to do so again.

    Thanks.
    zermatt

  • Reality Strikes

    zermatt…

    See I know you are a good guy. A little intelligent banter is a good thing and it is my pleasure to do it with you. Just for the record, I think the lawyers, lobbyists etc are cooked. So don't worry about them so much, they don't create anything and the marketplace will rule whether they like it or not.

    The people will continue to vote with their dollars. Talk soon!

  • markb1965

    BogusReporting from Fox News should be made visible everywhere.

    egmCarTech, thanks for steppingup and setting teh record straight. That's part of the reason I DO read your posts.

  • zermatt

    ….but not in a timely way.

  • markb1965

    BogusReporting from Fox News should be made visible everywhere.

    egmCarTech, thanks for steppingup and setting teh record straight. That's part of the reason I DO read your posts.

  • zermatt

    ….but not in a timely way.