Freddie Goes to Washington was a proposed sequel to Freddie as F.R.O.7. It was placed a little into production just as the film was being released.
Plot
There is little to no information on what the plot of the sequel was. However, it is speculated that after the events of the first movie, Freddie and his allies would travel to Washington, D.C. to finally defeat Messina for good, and Freddie would change back into a human.
Why It Was Cancelled
The first film proved to be a critical and commercial disaster, even in its country of origin. Production was effectively cancelled including the animation studio filling for bankruptcy shortly afterwards.