The old General Motors plant in Delaware that until July cranked out sports cars for Pontiac, Saturn and Opel will be sold and retooled to build plug-in hybrids with UAW workers.

Fisker Automotive said today that it will buy the plant, located in Wilmington, Del., from Motors Liquidation Co. -- the old General Motors Corp. -- for $18 million. If Fisker's plans come to fruition, production at the plant could start in late 2012.

Another $175 million will be spent to refurbish and retool the factory over the next three years, Fisker said in a statement. The company has qualified for $528.7 million in federal loans from the Advanced Technology Vehicle Manufacturing program.

Fisker plans to build a mid-sized plug-in hybrid family sedan that will sell for $39,900 after federal tax credits. The company plans to sell between 75,000 and 100,000 units per year, with about 50 percent to be exported.

Several hurdles

But a lot has to go right before that can happen.

The company has to hire and retrain a work force; design, develop and certify the car; and establish a supply base. So far, Fisker has sold only a few hand-built luxury cars based on BMW underpinnings. Its first higher-volume car, the $87,000 Karma, is slated to start production in Finland next year.

CEO Henrik Fisker said Wilmington was selected for its production capacity, world-class paint facilities, access to modern shipping ports, rail lines and skilled work force.

GM built the plant in 1947. Over the years it has built more than 8.5 million cars. Production capacity is 300,000 per year.

UAW is a 'partner'

The Fisker press release includes a statement from the plant's union, UAW Local 435.

"It gives me great pride to give UAW Local 435 workers the opportunity to partner with Fisker Automotive to create a greener America by building a plug-in hybrid car that will compete globally," Gary Casteel, the UAW director responsible for the plant, said in the Fisker statement.

According to its Web site, the local represents about 500 employees and 2,300 retirees at the plant.

Demands for fuel efficiency

Fisker was created in 2007 and utilizes the powertrain capabilities of Quantum Fuel Systems Technologies Worldwide Inc.

U.S. and overseas manufacturers are racing to deliver the first plug-in hybrids, which are viewed as the best near-term technology for transforming the American auto market.

Car buyers are demanding more fuel efficiency with gasoline prices high. The Obama administration and Congress, trying to reduce U.S. dependence on imported oil, are boosting funding for battery research and electric car production.

The auto industry is a cornerstone of the administration's efforts to promote and support "Green Economy" manufacturing, and the Delaware facility is the closet car plant to Washington.

"We understood a new chapter had to be written, a new chapter in which we strengthen American manufacturing by investing in innovation," said Vice President Joe Biden, who joined Fisker at the plant to make the announcement.

Biden represented Delaware in the U.S. Senate before becoming vice president.

Ford Motor Co., electric car maker Tesla Motors and Nissan Motors have also received government loans for building advanced technology vehicles. GM and Chrysler have applied for funding.

The sale of the Wilmington facility is subject to a routine evaluation period and bankruptcy court approval. Proceeds will be placed in the GM estate, according to the AlixPartners restructuring firm.

"This is a big day for Wilmington, a big day for the creditors in this case and, I believe, a good day for America," said Al Koch, the vice chairman of AlixPartners and Motors Liquidation CEO.

Motors Liquidation has about 200 properties, many of which are plant sites or landfills.

Many of the properties could be repurposed, Koch told Reuters previously, with some former plant sites possibly becoming transportation hubs or unused land donated to nature conservancies.

It was unclear if the proceeds from the Boxwood Road sale would be earmarked for creditors or for the U.S. government, which extended some $50 billion of bailout and bankruptcy funding to GM this year.

Reuters contributed to this report

PRESS RELEASE: FISKER AUTOMOTIVE TO BUY U.S. ASSEMBLY PLANT TO BUILD AFFORDABLE PLUG-IN HYBRID CARS

WILMINGTON, DE -- Oct. 27, 2009 – Fisker Automotive has selected the Wilmington Assembly plant in Wilmington Delaware to build affordable plug-in hybrid cars.

Fisker executives made the announcement inside the dormant facility today, joined by Vice President Joe Biden, Delaware Governor Jack Markell and other state officials.

The plant will support Fisker Automotive's Project NINA, the development and build of an affordable, family-oriented plug-in hybrid sedan costing about $39,900 after federal tax credits.

Production is scheduled to begin in late 2012. Fisker Automotive anticipates Project NINA will ultimately create or support 2,000 factory jobs and more than 3,000 vendor and supplier jobs by 2014, as production ramps up to full capacity of 75,000-100,000 vehicles per year. More than half will be exported, the largest percentage of any domestic manufacturer.

The modernized Wilmington Assembly plant was selected for its size, production capacity, world-class paint facilities, access to shipping ports, rail lines and available skilled workforce.

“This is a major step toward establishing America as a leader of advanced vehicle technology,” said Henrik Fisker, CEO. “Wilmington is perfect for high quality, low volume production and will soon be the proud builder of world-class, fuel-efficient Fisker plug-in hybrids.”

Fisker Automotive has signed a letter of intent with Motors Liquidation Co. (MLC), formerly known as General Motors Corp. to purchase the Wilmington plant for $18 million after a routine four-month evaluation period.

An additional $175 million will be spent to refurbish and retool the factory over the next three years.

Funds will come from a conditional loan of $528.7M the Department of Energy awarded the company in September.

The loan is part of the $25B Advanced Technology Vehicle Manufacturing loan program (ATVM) appropriated by Congress in 2007 to help the United States lead in the development and manufacturing of advanced technology vehicles.

The company's first car, the Fisker Karma, will be the world's first production plug-in hybrid when it goes on sale this summer at retailers in the U.S. and Europe.

Fisker plug-in hybrid cars will help remove the country's dependence on foreign energy by eliminating the need for 42 million barrels of oil by 2016. They will also offset 8 million tons of carbon dioxide emissions.

“With our close-knit business, government, and educational communities and our potential to respond rapidly to new opportunities, today's announcement is a testament to what works best in Delaware. Fisker is a perfect partner in shaping Delaware's economic future, and we are thrilled that the vehicle that can reshape the automobile industry will be built here in Delaware, by Delaware workers.” said Governor Jack Markell (D-Delaware).

Gary Casteel, UAW director responsible for the plant, said, "It gives me great pride to give UAW Local 435 workers the opportunity to partner with Fisker Automotive to create a greener America by building a plug-in hybrid car that will compete globally."

ABOUT FISKER AUTOMOTIVE, INC.

Fisker Automotive is a privately owned, premium American car company with a vision to lead the automotive industry into the next-generation of automobiles with high-end design expertise and eco-friendly powertrain technology. Global headquarters are in Irvine, California, USA.

The company was created in 2007 to leverage the design capabilities of Fisker Coachbuild, LLC, founded by auto design veterans Henrik Fisker and Bernhard Koehler, and the PHEV powertrain capabilities of Quantum Fuel Systems Technologies Worldwide, Inc. (NASDAQ-QTWW), a major Tier 1 supplier of clean vehicle technologies to the automotive OEMs. Previously, Fisker, CEO, was design director for Aston Martin and president and CEO of BMW's DesignworksUSA. Koehler, COO, led operations for Ford's Global Advanced Design Studio and created concept cars for Aston Martin, MINI and BMW.

ABOUT WILMINGTON ASSEMBLY

The Wilmington Assembly plant was built by General Motors in1947. Over the years it has been expanded to 3.2 million square feet on 142 acres of land. It includes an on-site powerhouse and waste water treatment facility. More than 8.5 million cars have been manufactured there, including the Pontiac Streamliner, original Chevrolet Impala, 1997-1999 Chevrolet Malibu, Saturn L-Series and the Pontiac Solstice/Saturn Sky/Opel GT roadsters. Production capacity is 300,000 cars per year. The plant and its workforce have received many awards for excellence in quality, production and safety.

PRESS RELEASE: AlixPartners Client ‘Old GM' Announces Agreement to Sell First Major Asset

Electric-Carmaker Fisker Automotive to Purchase Assembly Plant in Delaware

WILMINGTON, Del.--(BUSINESS WIRE)--AlixPartners LLP, the global business-advisory firm that since last December worked to help keep General Motors Corp. away from a freefall bankruptcy and that since July has managed the estate of “Old GM” (Motors Liquidation Co.), today commented on the announcement that MLC has signed a letter of intent to complete its first major asset sale: the sale of a former GM assembly plant in Wilmington, Del., to premium carmaker Fisker Automotive Inc. of Irvine, Calif., which has said it plans to build plug-in electric vehicles in the plant.

It was announced today that Fisker Automotive will be paying MLC $18 million for the 3.2-million-sq.-ft. plant, which was commissioned in 1947 and until this summer was building Pontiac Solstice, Saturn Sky and Opel GT models.

“This is a big day for Wilmington, a big day for the creditors in this case and, I believe, a good day for America,” said Al Koch, the vice chairman of AlixPartners who is currently serving as chief executive officer of MLC. “AlixPartners is a firm that has long prided itself on obtaining the best possible outcomes, no matter the odds, and that's certainly been our goal all along in this very big, very high-profile case. To that end, we are extremely pleased that not only will this plant not be going away, but that it will continue as a vehicle-assembly site, providing employment and other commercial activity in this area.”

Continued Koch: “We very much applaud the leadership of Governor Markell, the Delaware congressional delegation and many others here in helping make today's news possible. They've worked tirelessly to help us come up with a win-win-win outcome.”

Said Ted Stenger, a managing director of AlixPartners who is serving as executive vice president of MLC: “Wherever we have facilities or properties, we continue to work with government officials at all levels, community leaders and economic-development experts to try to identify re-use possibilities, consistent with the local market conditions, the attributes of each individual property and with our obligations under the bankruptcy code. This sale is an example of where many separate groups acted together to arrive at a solution beneficial to all. Working together, we hope to have more such solutions in the future.”

About AlixPartners

AlixPartners is a leading global business-advisory firm offering services across four main disciplines – operational performance improvement and strategic consulting, financial restructuring and bankruptcy reorganization, litigation consulting and financial advisory services. The firm's expertise is in helping clients anticipate, evaluate and successfully resolve urgent, high-impact business challenges in an increasingly complex legal, regulatory and economic landscape. Drawing on the experience of more than 900 employees from 14 offices across North America, Europe and Asia, the firm commits small teams of seasoned professionals to deliver results when it really matters. For more information, visit www.alixpartners.com.