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"At this stage, public money would not be protected," the spokesman for the fund, set up to help struggling businesses hit by the crisis, told Reuters.
It agreed in March to invest in niche car and equipment maker Heuliez, which builds the Tigra for General Motors unit Opel and is counting on a push toward electric vehicles for its future.
The spokesman said BKC had not given sufficient guarantees on the capital it would supply for the project and said a shareholders' meeting scheduled to launch the project could be canceled.
BKC president Louis Petiet was not immediately available for comment.
The FSI had planned to invest 10 million euros (US$14.9 million) in Heuliez's electric vehicle, alongside the region of Poitou-Charentes where the company is based which is set to invest 5 million.
BKC, the only interested candidate, was chosen in July to take over Heuliez.
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