October 31, 2011 7:12 AM

Another Solyndra? Electric car battery maker facing financial hardship

By
Laura Strickler
Topics
Follow The Money ,
News
EnerDel logo (Credit: CBS/iStockphoto)

A company whose subsidiary received $118 million in stimulus grant money from the U.S. Department of Energy to build new electric car batteries has now been removed from trading on NASDAQ.

EnerDel got an Energy Department grant in early 2010 for battery manufacturing in Indiana but the stock of EnerDel's parent company, Ener1, fell from $4.04 in 2010 to just 9 cents on Thursday. By Friday NASDAQ had pulled the company from its listing leaving the stock at $0.00.

NASDAQ took action after sending the company a notice saying it was out of compliance for failing to file its June 30th financial quarterly filing. The company notified shareholders back in August that two of the company's quarterly filings "should no longer be relied upon" and the company would have to re-do their financial statements.

"Once we get our financials restated, we'll look at what our options are for getting re-listed," Ener1 spokesperson Brian Sinderson told CBS News. Sinderson says the company is now traded on the over the counter market.

In late September, Ener1 replaced its CEO Charles Gassenheimer. Sinderson said the company felt it needed to change leadership due to the stock's performance.

The company says they have about 250 employees working at their three facilities in the Indianapolis area.

EnerDel reported to the Energy Department in their latest stimulus report that they had spent $53 million in taxpayer funds to date. At its peak, in the summer of 2010, the company employed 253 people with federal funds according to government records. Today the company reports that stimulus funds support 33 jobs.

Sinderson says for the company's facilities in Indiana there are no immediate hiring needs, "Right now I think we are pretty well staffed the way we are," but he added, "That could change tomorrow."

EnerDel notes in its stimulus spending reports that the project is more than 50% completed. The company would not disclose how many batteries it makes a month at its facilities in Indiana.

A spokesperson for the Energy Department, Damien LaVera said in an email statement to CBS, "The Department is closely monitoring the status of the company. So far $55 million of the grant has been paid out to EnerDel. Any additional funds received from the government would need to be matched dollar for dollar with their own investment."

LaVera noted that EnerDel received "broad bipartisan support and to date has progressed according to schedule and on budget."

At the same time that EnerDel got the stimulus grant in 2009, the company acquired a third of the Norwegian electric car maker Think Global which also had a production facility in Indiana. But the company went bankrupt earlier this year. Think Global's subsidiary was bought by a new company which now runs the plant in Elkhart, Indiana. Elkhart Mayor Dick Moore says Think America initially said they would hire 415 employees. Today there are only about a dozen working at the plant according to the mayor. However, he said, "We're optimistic, we need the jobs very badly."


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by AmericasConscious November 1, 2011 3:23 PM EDT
Obama and failing Green Energy Co's we want our 100s' of millions back form the failed stimulus package! Where did you hide it at.
Obama is unbelievable old Mr Hope and no Change.
Grand theift worse than the Occupy Wall ST are protesting!
Reply to this comment
by SlimeDog1 November 1, 2011 5:47 PM EDT
How many of the "Green" stimulus companies haven't gone into bankruptcy? Me thinks the large majority of them.
by rightbehind November 1, 2011 10:54 AM EDT
We all know how well 1.4 trillion dollars has worked for the two corporate wars. When were the republicans going to tell us that China got the oil?

We better start investing more than 200 million in batteries. For what has been spent on the two corporate wars we could have put solar power on 1 of every 3 single family homes in the United States. Just think of the jobs that would have been created.
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by Goofer-Buddy November 1, 2011 9:40 AM EDT
The Auditor Price Waterhouse is also the Auditor of MF Global whose buyer just bailed when a 900,000,000.00 dollar basic book keeping error was discovered during due diligence. Where is that cash? Where is that auditor?
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by cbsblogger November 1, 2011 12:05 AM EDT
Both Parties are corrupt and the USA is screwed and rocked by crony capitalism. Connected cronies walk away with the loot and the media rarely mentions their name let alone does an investigation. Solyndra was the same situation. Same with Wall St banksters. Same tribe - same corruption - same outcome. They all get our money while employees get shafted and taxpayers get the bill and we argue about the D or R. Hint, it is both and a media policy that never tells the story.

It would be interesting to note how much did the CEO (30 yo something) Charles Gassenheimer and his underlings get from the taxpayer? He was a NYC money boy not an engineer. What knowledge did he have of running a real company and not some financier casino firm. Two bits there is tribal commonality with not only Solyndra, but most of Wall st. http://people.forbes.com/profile/charles-a-gassenheimer/29767

If Kaiser and Gassenheimer and many others who have fed at the US trough of excess were Hindu, Muslim or Mormon, the media would have no trouble reporting the coincidence, but they turn their backs when it is something else.
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by obwan222 October 31, 2011 9:28 PM EDT
Fred Upton, the House Energy and Commerce Committee chairman, who is currently investigating Solyndra and other parts of the stimulus, himself appealed to Energy Secretary Steven Chu and other Energy officials in 2009 for similar grants. In a series of 10 letters, Upton and colleagues highlighted projects in Michigan that, if granted more than $250 million, could create more than 5,000 jobs.

House Oversight and Government Reform Committee chairman Darrell Issa asked for the government to fund an electric-car company in California. "Awarding this opportunity to Aptera Motors will greatly assist a leading developer of electric vehicles in my district," Issa wrote in January 2010, just 18 months before he began investigating the Solyndra controversy.
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by littleredtop October 31, 2011 6:36 PM EDT
Now with this one, he's flushed $1 billion in tax payer money on BS schemes.
Reply to this comment
by askagain October 31, 2011 7:25 PM EDT
pahgre - Even if you were right, to quote an old expression, "Two wrongs don't make a right.
by Martha12345 October 31, 2011 5:53 PM EDT
Another Obama success story !!
Reply to this comment
by bmallen3 October 31, 2011 5:49 PM EDT
just another reason to vote Obama out of office.
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by PR_in_Alabama October 31, 2011 5:35 PM EDT
In this country we can't run a business anymore! you have this hot shots that can't compete with globalization.

CEO & CFO probably got paid a few million bucks for running the business to the ground, An we complain about the wall street take overs?!! this is the reason why!!
Reply to this comment
by askagain October 31, 2011 5:06 PM EDT
It is irresponsible for taxpayer money to be used for start-up companies. Part of the problem is that the government wants to create a demand when no such demand exist. A large percentage of new businesses fail. We would get more bang for the buck if the government allowed successful companies to explore for more domestic oil and to mine more coal and other tried and true forms of energy such as natural gas. If major companies aren't jumping on alternative energy, it is because they don't feel the demand and payoff is out there. Look at the wireless industry. The original wireless companies were generally small regional companies who got things started. Large companies such as AT&T and Verizon jumped in after they became convinced that they could make money in the wireless industry. There is plenty of venture money out there only, as investors, they want to be reasonably certain that the venture is worthwhile. Government, on the other hand, is not motivated by profit which drives investment.
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