Without DOE Loan, Plug-in Hybrid Electric Automaker Bright Automotive Closes Its Doors

Bright Automotive IDEA Van

“Had we known three years ago what we know now, we’d be a Chinese company–and we’d still be in business,”
Mike Donoughe, COO Bright Automotive
Commenting after not receiving $314 million loan from DOE

It’s unfortunate anytime a business has to shut down due to lack of funding but sometimes, maybe it was meant to be. According to an article on Cnet last week, Bright Automotive is ceasing operations due in large part to a $314 million loan they expected from the Department of Energy and never received. Their aerodynamic IDEA van was supposed to change the way fleet delivery companies transport products. But without the loan, they’re unable to go into production.

Should we blame the DOE or was the IDEA van a product with no market? Was the DOE afraid to move forward with the loan due to their failed experience with Solyndra? We’ll never know the answer to either question but I am sure of one thing – I’m glad Bright Automotive didn’t get the loan.

Why? Because I don’t want to see another private company with nothing to lose borrowing money from the federal government with nothing at stake. If Bright Automotive had created a truly game-changing idea, they wouldn’t need to borrow funds from the federal government. Private investors, with their client’s blessing, would’ve jumped on a must-have product and opportunity but Bright Auto’s IDEA van was not it.

And it feels like Bright Auto’s goal was to leverage the loan in order to sell back to the government; in this case, supply the US Postal Service with the IDEA van. Anyone who has attempted to sell to the government knows about the nonsensical way they work. Businesses that are willing to prop up their one-eyed grandmother as the majority owner will receive preferred bid status – being on the hook with the feds for $314 million would put Bright in a bid class of their own and way ahead of a cyclops-granny.

Is this how it played out with Bright Automotive? I’m not sure but based on the opening comment of their COO, it appears they were looking for a sugar daddy and I’m relieved that the DOE wasn’t it. [Cnet]