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Another Obama green energy company goes down the drain - smn1256 - 04-12-2014 09:53 PM
![[Image: 1aOrjn.St.81.jpeg]](http://media.kansascity.com/smedia/2014/04/04/20/41/1aOrjn.St.81.jpeg)
Smith Electric Vehicles, a centerpiece of the Kansas City area’s once high hopes for a wave of green industries, quietly suspended production at the end of 2013 because of a shortage of cash.
The move was disclosed in a report for the last quarter of 2013 filed with the U.S. Department of Energy, which in 2010 awarded the company a $32 million grant. Smith Electric said it stopped delivery of its Generation 2 trucks and vans because of the “company’s tight cash flow situation.”
The company didn’t respond to requests for comment. The Energy Department in an email said it is working to ensure that a demonstration project that is supposed to have 510 Smith Electric vehicles placed in fleets across the country will be successfully concluded.
The move was disclosed in a report for the last quarter of 2013 filed with the U.S. Department of Energy, which in 2010 awarded the company a $32 million grant. Smith Electric said it stopped delivery of its Generation 2 trucks and vans because of the “company’s tight cash flow situation.”
The company didn’t respond to requests for comment. The Energy Department in an email said it is working to ensure that a demonstration project that is supposed to have 510 Smith Electric vehicles placed in fleets across the country will be successfully concluded.
“DOE continues to work with Smith Electric on the path forward for the remaining vehicle production,” the federal agency said Thursday in the email.
Smith Electric, which would eventually have about 100 employees, arrived in Kansas City in 2009, setting up offices and a production facility near Kansas City International Airport. It marketed its electric vehicles to businesses that make deliveries and snagged some notable customers, including Coca-Cola, Staples and Frito-Lay.
Along the way it got plenty of attention.
“You’re setting a model for what we need to be across this country,” said President Barack Obama when he visited the plant in 2010.
But the initial glow dimmed, and signs of problems began to emerge. The company bowed out of an initial public offering in 2012 and scaled back production. It has also left hanging well-publicized plans for two more assembly plants.
The company said in 2011 it would open an assembly plant in New York and in 2012 announced plans for another one in Chicago. That was warmly greeted by Mayor Rahm Emanuel of Chicago, who said he was proud to welcome Smith Electric.
Neither started production as promised. The Chicago mayor’s office now refers inquiries about the proposed plant to Smith Electric. The Bronx Overview Economic Development Commission, which played a major role in getting the proposed plant in New York, declined to comment.
That leaves the Kansas City plant. It has depended heavily on the $32 million federal grant, which paid for some development costs and subsidizes the purchase price for vehicles in the demonstration project. Fleets operated by companies such as Frito-Lay buy the discounted vehicles, which include a telemetry system that provides live data on their performance.
At the end of last year, 439 of the demonstration’s 510 vehicles had been produced, according to the company filing. Only $2.9 million remains in the grant, and none was disbursed in the fourth quarter.
Smith Electric’s plight is not all of its own making. More companies are offering trucks that rely entirely on batteries for power, and other low-emission options such as natural-gas-fueled and hybrid electric trucks are available. The result is fewer orders for a company like Smith Electric.
“I feel there are more competitors in the space than the market can bear,” said Lisa Jerram, a senior analyst for Navigant Research, which focuses on emerging energy technologies.
But Smith Electric has also been overly optimistic about its prospects. Last August it announced that a project in the Houston/Galveston area of Texas would replace 30 diesel-fueled vehicles with 30 Smith Electric trucks.
It turns out those sales were far from assured. Meredith Linscott, a project manager for the Center for Transportation and the Environment, which is managing the Texas project, said the manufacturer of the trucks would be up to the fleets who participated.
“We’re open to other manufacturers as well,” she said.
Meanwhile, Smith Electric has some business to do in Kansas City. The city’s Aviation Department leases the offices and production facility to the company. The payments have filled city coffers with $2.4 million over the past five years.
But the lease is up for renewal, and negotiations are underway.
Joe McBride, a spokesman for the Aviation Department, said Smith Electric is a valued tenant, but he declined to say whether the company is current on its lease.
“It is not our policy to negotiate publicly with any tenant,” he said, “and that is why we cannot discuss current lease payments made or not made by Smith Electric Vehicles.”
To reach Steve Everly, call 816-234-4455 or send email to severly@kcstar.com.
Read more here: http://www.kansascity.com/2014/04/04/4937689/smith-electric-vehicles-has-suspended.html#storylink=cpy
RE: Another Obama green energy company goes down the drain - Jerry Falwell - 04-14-2014 09:07 AM
2 days of crickets.
There's got to be a good chart to show all of the money the US Government has pissed away since Obama on GE, GM, Boeing, etc. in relation to every man/woman/child.
Corporate Welfare, aka Crony Capitalism, is the exact thing they voted Obama in to fight. Fools.
RE: Another Obama green energy company goes down the drain - HeartOfDixie - 04-14-2014 09:08 AM
American style corruption
RE: Another Obama green energy company goes down the drain - DrTorch - 04-14-2014 09:32 AM
(04-14-2014 09:07 AM)Jerry Falwell Wrote: 2 days of crickets.
Leftists don't do well with facts.