Bright Automotive, a US-based electric van company, is winding down after being unable to secure funding from the US Department of Energy.
Reuben Munger, chief executive of Bright Automotive, and Mike Donoughe, its chief operating officer, wrote a strongly worded letter on Tuesday to US energy secretary Steven Chu, which said the company had been "forced to say ‘uncle’" by "onerous terms" demanded by the US department of Energy for its loan programme.
The company had been attempting to secure a $400m loan from the Department of Energy. The development follows the company receiving a $5m investment from GM Ventures, the corporate venturing unit of US-based automaker GM Ventures, in the corporate venturing unit’s first deal in 2010, as Global Corporate Venturing reported at the time. The company has also previously been backed by US-based aluminium company Alcoa, US-based energy company Duke Energy, search engine company Google’s foundation, Google.org, industrial company Johnson Controls and charity the Turner Foundation. All these shareholders were contacted with a request for comment for this article.
The company raised $16.2m in April 2009 from investors including Duke Energy’s investment unit Duke Investments, according to this Securities and Exchanges Commission filing. The company also raised $4m in 2011, according to this SEC filing, as well as $850,000 last month, according to this filing.
The executives wrote: "Last week we received the fourth "near final" Conditional Commitment Letter since September 2010. Each new letter arrived with more onerous terms than the last. The first three were workable for us, but the last was so outlandish that most rational and objective persons would likely conclude that your team was negotiating in bad faith. We hope that as their Secretary, this was not at your urging."
The pair said that the move had stopped job creation, as well as "turning the back" on a company helping to end "America’s addiction to foreign oil".
They added their "due diligence" process had taken more than 1175 days. They said: "That is a record for which no one can be proud." The inability of Bright Automotive to secure funding follows the collapse of US-based solar company Solyndra last year, which had been backed by a $535m loan guarantee from the US Department of Energy.
Separately yesterday the US Department of Energy revealed a $180m project to finance offshore wind.