A major shakeup in V-Vehicle’s top management, in the wake of that company’s failure to secure a $320 million Department of Energy capital loan, has the smart money indicating the firm is close to melting away.
The Monroe News-Star reported late Friday that V-Vehicle CEO Frank Varasano and Vice President for Assembly Horst Metz have departed the firm, as Varasano was terminated by the company’s board and Metz subsequently quit. VVC also canceled its lease for the former Guide Corp. plant outside of Monroe, where it was expected to produce its four-door hatchback cars with a 40 MPG fuel rating and a $10,000 retail price. Ruston investor James Davison, who owns the Guide plant, told the paper he thinks it’s a “long shot” that VVC will ever make a car at the facility.
Raymond Lane, a managing partner at Kleiner Perkins, V-Vehicle’s venture capital firm, is taking over the company on an interim basis, and a search will commence for a permanent CEO. VVC also says they still intend to make cars in Monroe, and will renegotiate a new lease at the Guide plant when their re-application for a Department of Energy loan is accepted.
Or when the Hornets win the NBA Championship.
This isn’t necessarily the end for V-Vehicle, but it’s certainly a sign that anyone expecting the project to bear fruit is kidding themselves.
Meanwhile, V-Vehicle sent the state of Louisiana a reimbursement check for some incentive cash the Department of Economic Development had floated it – but the check was some $14,000 short.
Kiss that money goodbye.
Louisiana Economic Development secretary Stephen Moret says that the $67 million the state had allocated out of its megafund incentive program is “still committed,” but amid a billion-dollar budget shortfall this year the odds of that money holding up are pretty long.
The larger lesson here seems to be that startup companies, particularly out-of-state startup companies, shaking down politicians for taxpayer dollars aren’t worth the time, money and effort to lure. Those startups which can’t raise private-sector money in suitable volume for viability are long shots. Louisiana can’t afford long shots.
Here endeth the lesson.