It was alarming when the federal government provided a $529 million loan to help a California car company build expensive plug-in hybrid electric cars -- in Finland!
But now that the start-up company, Fisker Automotive, is turning out its pricey sports cars, the painful results are more evidence that Washington needs to get out of the car business as fast as possible.
Consumer Reports magazine took the $108,000 car, ironically called the Karma, for a test drive. Here is what happened:
"While doing speedometer calibration runs on our test track ... the dashboard flashed a message and sounded a 'bing' showing a major fault. Our technician got the car off the track and put it into Park to go through the owner's manual to interpret the warning. At that point, the transmission went into Neutral and wouldn't engage any gear through its electronic shifter except Park and Neutral.
"We let the car sit for about an hour and restarted it. We could now engage Drive and the same error message disappeared. After moving it only a few feet the error message reappeared and when we tried to engage Reverse the transmission went straight to Park and again no motion gear could be engaged. After calling the dealer, which is about 100 miles away, they promptly sent a flatbed tow truck to haul away the disabled Fisker."
So the brand-new, U.S. government-subsidized Karma broke down on its test drive.
"We buy about 80 cars a year and this is the first time in memory that we have had a car that is undriveable before it has finished our check-in process," the seemingly astonished author of the article in Consumer Reports wrote, adding that the magazine had spotted other problems with another Karma.
"[S]o far, Fisker ownership is proving to be a bumpy ride," the article added.
And even people who have no intention of buying a Karma are being taken for a "ride," because tax dollars helped Fisker design the car.
Vice President Joe Biden initially praised the half-billion-dollar loan to Fisker as a path to thousands of manufacturing jobs in America. Instead, Fisker has created a few hundred jobs in Finland. And instead of reviving a shuttered General Motors plant in Delaware as promised, Fisker recently laid off most of the skeleton crew it had working at that plant, as well as 40-45 engineers in California.
All this comes on top of the unpopularity of the government-subsidized Chevrolet Volt and other electric vehicles. GM actually suspended production of the Volt recently because the car just wasn't moving at dealerships despite huge federal tax credits for its purchase.
It should be apparent to the Obama administration and Congress by now that top-down, government-directed economies do not produce jobs and real innovation, much less products that satisfy consumers and meet their needs. What the government subsidies, bailouts, tax credits and other market-distorting interventions are creating is a bigger national debt.
Washington has no expertise in building automobiles, and it is past time for it to get out of the car business.
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