Thursday, April 7, 2011
Salinas’ great green hope may be sputtering to a stop.
Documents obtained by the Weekly show Green Vehicles, an electric carmaker that operates out of the old Firestone plant outside Salinas, is behind on its rent and running low on cash, despite a $2 million grant from the California Energy Commission.
According to an email from Green Vehicles founder Mike Ryan to Salinas Mayor Dennis Donohue, Economic Development Director Jeff Weir and a representative of the company’s landlord, the company tried to “barter for the January lease payment by offering an electric vehicle.” The company hasn’t paid February or March rent, either, although the March 18 email says: “Green Vehicles has invoiced the CEC for February’s lease payment, and in two weeks we will invoice for March.”
Ryan didn’t return numerous calls seeking comment; nor did STG Group, the company’s Santa Rosa-based landlord. In the email, Ryan says, “As a startup company, we are currently operating on the edge cash-wise, and cannot float the [rent] payments, even though we would like to.”
The CEC selected Green Vehicles to receive a $2 million grant in 2009, but the grant wasn’t executed until January 2011. As it was wooing the formerly San Jose-based company to set up shop locally, Salinas gave the start-up some $700,000 in 2010. And then the county waited for the company to roll out its new 2.0 Triac sedan, a tiny, three-wheeled electric car with a 100-mile range between charges.
In late January of this year, Ryan told the Weekly he hoped to make 2,000 cars in 2012 – selling at $25,000 each – and more than 11,000 by 2015. At the time, he blamed the state for slowing production, saying his company needed the CEC funding before it could begin making Triacs.
But according to CEC spokesman Adam Gottlieb, “There is no holdup. The grant agreement was executed on Jan. 28 of this year. We don’t give them the grant for the full amount; Green Vehicles needs to submit invoices in hard copy – not email – and we’re happy to process the paperwork. It’s on their end.”
To date, Gottlieb says, Green Vehicles has one invoice pending in the amount of $131,263. When asked how long before the car company should have the cash, Gottlieb says, “I can’t comment on how fast a check is cut.”
Meanwhile, electric vehicle competition increases almost as quickly as gas prices.
Tesla Roadsters, Nissan Leafs and Chevy Volts are already on the market, and the Coda Sedan, Ford Focus Electric and Mitsubishi “i” are slated to launch this year. Electric cars by Audi, Daimler and Volkswagen are in the works, too.
Salinas Mayor Dennis Donohue says he’s not giving up hope.
“Clearly electric vehicles are going to be part of the mix of the automotive industry and I’m pleased to be part of that,” he says. “Green Vehicles is a startup and there’s growing pains with startups. I fundamentally view the rent discussion as an internal matter between them and their landlord. What we are focused on is the chance for the Salinas Valley and Monterey County to be part of an emerging industry.”
In exchange for receiving city money, Green Vehicles pledged to hire locals: One resident for each $32,500 of the more than $300,000 in federal Community Development Block Grant funding provided by Salinas to the company. It hasn’t yet met this requirement.