Tuesday, May 13, 2014

Smith Electric Vehicles, Yet Another Green Failure

Four years have passed since President Obama visited Kansas City's main airport, rolled up his shirt sleeves and admonished the skeptics who said Smith Electric Vehicles was unlikely to make good on its promises to build 510 experimental electric-powered trucks and buses suitable for commercial use.

“Come see what’s going on at Smith Electric," the president said, inspecting a table full of bright green truck batteries in what was once a maintenance hangar for TWA. "I think they’re going to be hard-pressed to tell you that you’re not better off than you would be if we hadn’t made the investments in this plant.”

The skeptics turned out to be right.

Despite $32 million in federal stimulus funds and status as one of Obama's favorite "green" companies, the firm has halted production, having built just 439 of the promised 510 vehicles.
It has also left a trail of broken promises and unpaid bills.
Smith created just a quarter of the jobs it initially promised the state of Missouri it would create in return for $1.4 million in tax credits. Meanwhile, it has also stiffed the Missouri University of Science and Technology, the state government, and a local electrical supply company, as well as its landlord, the Kansas City city government, for hundreds of thousands of dollars, according to interviews and reviews of public records by the Washington Examiner.

As of today, the company still owes $36,000 to Missouri S&T for work the university performed as a subcontractor on a U.S. Army project.

“If you’re not going to pay your [subcontractors] for satisfactory work that was performed, then it does wave a red flag whether the company was a responsible company and whether it should even be doing business with the federal government," said Scott Amey, general counsel for the nonprofit Project on Government Oversight.

An American subsidiary of a British firm, Smith Electric stopped production at the end of last year, a fact that was made public only last month. Angela Strand, the firm's chief marketing officer and a company spokeswoman, declined to discuss its financial problems, telling the Washington Examiner in an email, “we do not comment on financial matters.” The company hopes to resume production this summer.

Smith failed to hire at least 100 workers over a two-year period in return for up to $1.4 million in state tax credits. At the end of two years, it had hired only 54 workers, records show.

The firm's original promise was for a minimum of 202 new jobs, but the Missouri Division of Workforce Development halved that goal — a change that division official Alicia Roling described in a 2011 internal email as an “unprecedented modification.”

Read More: The Washington Examine