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Fisker Automotive, whose high-end electric cars caught the eye of Justin Bieber and other celebrities, has filed for bankruptcy protection.
The California-based company also announced that it had entered an asset purchase agreement with Hybrid Tech.
"After having evaluated and pursued all other alternatives, we believe the sale to Hybrid and the related Chapter 11 process is the best alternative for maximising Fisker Automotive's value for the benefit of all stakeholders," Marc Beilinson, Fisker's chief restructuring officer, said in a statement on Friday.
Fisker was started in southern California in 2007 by former Aston Martin and BMW designer Henrik Fisker and German business partner Bernhard Koehler.
While the company did not have the expected success with its pricey hybrid Karma sports car, which it billed as "a bold expression of uncompromised responsible luxury", it did attract interest from the likes of stars such as Bieber, Leonardo DiCaprio and Ashton Kutcher.
Having struggled financially for some time, Fisker announced in April that it was laying off 75 per cent of its workforce.
The bankruptcy could become a political hot potato because the United States government had focused on the firm to encourage the development of green energy, providing it with loans.
The Wall Street Journal cited the Department of Energy as saying it had recovered US$53 million of the US$192 million Fisker owed to the government, leaving US$139 million unpaid.
Two Republican members of Congress, House Energy and Commerce Committee chairman Fred Upton and Oversight and Investigations Subcommittee head Tim Murphy, have already lashed out over the matter.
"Fisker's collapse closes yet another sad chapter in [the Department of Energy's] troubled portfolio," they said in a joint statement. "The jobs that were promised never materialised and, once again, taxpayers are on the hook for the administration's reckless gamble."
During the 2012 US presidential election campaign, Republicans repeatedly highlighted the fate of solar energy firm Solyndra, which went bankrupt after getting a US$500 million government loan guarantee.


Electric-car firm Fisker files for bankruptcy

A Fisker Karma luxurious electric car is seen at the US car maker's booth during the 83rd Geneva Motor Show in 2013. Photo: AFP

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US carmaker also sells assets to Hybrid Tech after Karma fails to live up to expectations


Fisker Automotive, whose high-end electric cars caught the eye of Justin Bieber and other celebrities, has filed for bankruptcy protection.


Electric-car firm Fisker files for bankruptcy

.css-1c6uqr6{color:inherit;font-weight:inherit;font-size:inherit;font-family:inherit;line-height:inherit;overflow-wrap:break-word;}US carmaker also sells assets to Hybrid Tech after Karma fails to live up to expectations

US carmaker also sells assets to Hybrid Tech after Karma fails to live up to expectations