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Hybrid Car Bankruptcy Could Cost Government Hundreds of Millions

The bankruptcy of Fisker Automotive could end up costing the U.S. government much more than the $168 million it loaned to the maker of the Karma plug-in hybrid sports car.

According to its bankruptcy filing on Friday, Fisker owns tax breaks worth $320 million.

Fisker's bankruptcy papers said the Southern California-based company plans to sell its automotive operations to a business affiliated with Hong Kong tycoon Richard Li, but it will hold on to the tax breaks after it emerges from bankruptcy.

Fisker piled up some $800 million in net operating losses in recent years, which have a future cash benefit worth approximately $320 million, according to the bankruptcy filing.

That lost tax revenue would add to taxpayers' pain from Fisker's failure.

Source: Reuters. Read full article. (link)

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  • buybuydandavis||

    Wonderful. They won't actually make anything, but they will cash in on their government tax carve outs.

    Crony capitalism at it's best.

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