Li-Ion Motors Wave II, Progressive Automotive X-Prize winner.Enlarge Photo
A little over a year ago, a relatively unknown electric automaker called Li-Ion Motors Corp. won the $2.5 million Alternative Side-By-Side Class in the Progressive Insurance Automotive X-Prize.
Since then, Li-Ion Motors has been putting out regular press releases and information about its two electric cars -- the X-Prize-winning Wave II and the its super-hyped but never-quite finished Inizio super-car.
Sadly for Li-Ion Motors, the press releases seem little more than a thin veil over a backdrop of allegations of misconduct and fraud, court cases and even a U.S. and securities and Exchange Commission investigation.
Now the firm seems to have sunken to a new low.
According to The New York Times, Li-Ion Motors has been caught pitching the possibility of a federal low-interest loan as the keystone to building a 600-job manufacturing plant to potential investors.
The problem? Over a year ago, before the firm had even won the Automotive X-Prize, officials from the Department of Energy wrote to the firm detailing how it did not meet the criteria for an Advanced Technology Vehicles Manufacturing Incentive Program (ATVMIP) low-interest loan.
Yet in a recent publication of the Vehicle Electrification magazine, a quote from a company spokesperson remained buoyant about the possibility of a loan.
“Li-Ion Motors has applied for -- but has not yet received -- federal funding to help with vehicle development and manufacture”, the article wrote. After its publication, Li-Ion Motors then publicized the article to its investors.
Admittedly, it’s been a year since the X-Prize, and over a year since Li-Ion Motors received its initial decline of funding. But with the $2.5 million prize fund going to settle a pre-existing court claim against the firm and not the fellow X-Prize contestants the firm promised to share it with, we’re really not sure how Li-Ion Motors fortunes have changed enough to make it eligible for federal assistance.
You see, in order to be eligible for a loan under the ATVM program, a firm must first prove itself viable even without a loan guarantee. In other words, it has to prove that any monies loaned to it stand a good chance of being repaid.
For now then, Li-Ion Motors seems caught in a web of its own weaving. Stand well clear.