VPG Shutters Operations

The list of companies that accepted government loans and then closed their doors due to financial or other difficulties now has a new entry: Vehicle Production Group (VPG) of Allen Park, MI. The maker of vans for the disabled called the MV-1, shut down operations and laid off its staff in February after the U.S. government froze the assets of the company. VPG received a $50-million Energy Department (DOE) loan to produce a compressed natural gas version of their vehicle. The company no longer met the minimum requirements that were a condition of the loan.

At this point, the company has not filed for bankruptcy protection. The MV-1 is the only purpose-built vehicle that was designed from the ground up for wheelchair accessibility. It features a deployable access ramp with a 1,200-pound weight capacity, a 36-inch entryway, and an interior that accommodates up to six occupants.

The company built 2,500 MV-1 vans and a healthy order backlog, but it ran low on cash and didn’t have the dealer network that it needed to grow. The company had hoped to expand production by selling a taxi version of the vehicle. In fact, the company displayed the taxi at the New York Auto Show last year. The specialty cab garnered some interest from some municipalities and the company expressed hope that it could eventually ramp up production to about 30,000 vans a year.

VPG is the third company in recent months that ceased operations in spite of receiving government loans aimed at sparking the development green vehicles. A U.S. congressional committee is investigating the Energy Department’s loans for alternative-fuel vehicles after the manufacturers have been plagued by financial problems.

VPG was initially based in Ft. Lauderdale, FL, but relocated its headquarters to Michigan last fall.

VPG worked with General Motors through its on-highway integrator Powertrain Integration LLC to develop the vehicle’s powertrain. To produce the CNG version, it partnered with Clean Energy Fuels Corp., founded by T. Boone Pickens, and both were investors in VPG. AM General assembled the vehicles at its Mishawaka, IN Facility.

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