Fisker Automotive

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Karma Automotive, LLC (formerly Fisker Automotive, Inc.)
Private
Industry Automotive
Fate Declared bankruptcy in November 2013; assets bought by Wanxiang in February 2014
Founded August 7, 2007[1][2]
Founder Henrik Fisker,
Bernhard Koehler[3]
Headquarters Anaheim, California, U.S.[4]
Key people
 Tony Posawatz, (CEO)[5]
Bernhard Koehler, (COO)[6]
Products Luxury Plug-in hybrid cars
Number of employees
 53 (March 2013)[7][8]
Slogan "Pure driving passion" (former)
Website Karma Automotive

Karma Automotive, LLC was an automaker originally based in Anaheim, California. The company's first and only product was the Fisker Karma, one of the world's first production plug-in hybrid electric vehicles. It debuted at the 2008 North American International Auto Show, creating the premium green car segment in which most major manufacturers have since announced they would compete. Production was suspended in November 2012 due to financial difficulties,[9] with about 2,450 Karmas built since 2011.[10] The assets of the company were purchased by Wanxiang America, Corp., a Chinese auto parts maker, and the company was renamed the New Fisker.

Fisker originally intended to sell the Karma in late 2009, but after repeated delays,[11][12] the Environmental Protection Agency certified the car’s vehicle emissions and drive range in October 2011,[13] and thereafter Fisker commenced delivery of production vehicles in the USA.[14]

Fisker stopped production in the summer of 2012, and was seeking new investment. Matters were further complicated by the bankruptcy of its battery supplier A123 Systems, the costs involved regarding a recall and repairs to customer cars, as well as the resignation of the company's co-founder and CEO, Henrik Fisker.[15] In addition to production stopping for over five months, with no date announced to recommence, the planned production of the second model, the Fisker Atlantic, was postponed, together with the cessation of development of the new model.[16]

Fisker eventually declared bankruptcy in November 2013, and in February 2014 the company was bought by Chinese auto-parts conglomerate Wanxiang Group.[17]

On September 30th, 2015 Fisker Automotive announced they would be changing their name to Karma Automotive. James Taylor, Karma’s Chief Marketing Officer said, “With new ownership, a new management team, and a new production site, all here in California, it was time to communicate change,.” [18]

History

Fisker Karma outside the Fisker headquarters in Anaheim, California

Henrik Fisker co-founded the company in 2007 with business partner Bernhard Koehler (Fisker Coachbuild) and Quantum Technologies after securing a relatively small investment from Gianfranco Pizzuto, an Italian businessman, and Palo Alto Investors. Henrik Fisker is responsible for designing many premium cars such as the Aston Martin DB9 and V8 Vantage, Artega GT and BMW Z8. He also served as design director and sat on the board at Aston Martin.

Prior to Fisker Automotive, Henrik Fisker and Koehler left Aston Martin in 2005 to establish Fisker Coachbuild, in an attempt to revive the art of coach building automobiles to customer specifications.[19] The Fisker Tramanto and Latigo utilized chassis and power trains from Mercedes-Benz SL and BMW 6-Series automobiles. Several were purchased but the business soon gave way to Fisker Automotive, a true automobile manufacturer. In 2009 Henrik Fisker mentioned plans for another plug-in hybrid, a "high-volume vehicle for a lower price", subject to getting a U.S. Department of Energy loan[20] to build about 100,000 vehicles annually in the United States.[21]

On April 14, 2008, Tesla Motors filed a lawsuit against Fisker Automotive, alleging they stole Tesla's technology and are using it to develop their own hybrid car, the Fisker Karma, which was announced at the North American International Auto Show in January 2008. Tesla's suit claims that the design work done for the Model S by Fisker Coachbuild was substandard, and that Fisker diverted its best ideas to the Karma.[22] In early 2009 the suit was settled in Fisker's favor and Tesla was ordered to pay Fisker more than US$1.1 million in legal fees.[23][24]

Fisker received a US$528.7 million conditional loan in September 2009 from the Department of Energy's US$25 billion Advanced Technologies Vehicle Manufacturing Loan Program (ATVM).[25][26] A total of US$169.3 million is for engineering work with primarily USA suppliers to complete the Fisker Karma, design tools and equipment, and develop manufacturing processes. The DOE announcement of the conditional loan went on to reveal the code name for the new vehicle: "The second stage includes a $359.36 million ATVM loan for Fisker's Project Nina, involving the manufacture of a plug-in hybrid in the U.S.",[27] expected to reduce pollution corresponding to 30,000 fewer cars.[25] For comparison, the US$465 million ATVM loan to Tesla corresponds to 5,000 fewer cars.[28] "Project Nina" was later revealed as the Fisker Atlantic.

On October 27, 2009, Fisker officials announced that the company had signed a letter of intent to take control of the Boxwood Road Plant (previously owned and operated by General Motors as Wilmington Assembly) in Wilmington, Delaware:[29]

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Production is scheduled to begin in late 2012. Fisker Automotive anticipates Project NINA will ultimately create or support 2,000 factory jobs and more than 3,000 vendor and supplier jobs by 2014, as production ramps up to full capacity of 75,000-100,000 vehicles per year. More than half will be exported, the largest percentage of any domestic manufacturer.

Vice President Joe Biden attended the announcement.[29] In addition to a purchase price of US$20 million, Fisker expects to invest US$175 million re-tooling the plant.[30] The Government of Delaware provided US$21 million in funding for the plant.[31] Fisker later suspended development of the Wilmington plant as a result of a freeze on its federal loan and suggested that production might shift elsewhere unless its funding is restored.[31][32]

After drawing US$193 million, the government froze Fisker's credit line in May 2011 after it was determined that the company had not met milestones set as conditions for the loan[32] and hired Houlihan Lokey to assist in monitoring Fisker's progress.[33] The loan received additional scrutiny for being awarded for the manufacture of luxury vehicles that are too expensive for much of the general public.[34] Fisker investor Ray Lane responded that the issues were being blown out of proportion due to election year politics.[34]

In February 2012, Tom LaSorda was named the new CEO,[35] and Henrik Fisker became Executive Chairman.[36] but only six months later on August 14, La Sorda was replaced by Tony Posawatz, previously General Motors Vehicle Line Director for the Chevrolet Volt.[37]

In April 2012, Fisker announced it had received US$392 million in a recent round of financing.[38]

In July 2012, Fisker shut down all production and hired financial adviser Evercore Partners to find new partners and investors but in December 2012 Fisker claimed it was not for sale.[39] With government credit lines suspended and no income, company officials have sought further government loans and subsidies, and continued to search for investors, lenders, and buyers, and still hopes to find customers in China, England, and continental Europe.[40] By the end of 2012, the search for funding continued, and Fisker had to cease development of the second model line which was around 90% complete.[16]

The company suffered a setback on October 29, 2012 when Hurricane Sandy flooded and destroyed its entire European shipment of 338 Karmas at Port Newark, New Jersey.[41] Sixteen of the cars burned, because six to eight feet of seawater caused a short circuit in a Vehicle Control Unit in one Karma, and high winds spread the resulting fire to fifteen others.[42] The company said that its Lithium Ion battery was not at fault.[42] Insurer XL Insurance America initially denied the approximately US$30 million loss claim and was subsequently sued by Fisker in New York State Supreme Court. The case was settled with an undisclosed out-of-court agreement.[43]

In late March 2013, Fisker hired a law firm to prepare for a possible bankruptcy filing.[44] On April 5, 2013, Fisker laid off 75% of its workforce with no notification, retaining only a core group of 40 workers as it continues to negotiate with prospective investors.[45]

Company bankruptcy

Henrik Fisker, who co-founded the company named after him, resigned in March 2013,[46] after "disagreements with management," in particular "disagreements over business strategy."[47] The New York Times reported that Fisker's resignation came during takeover negotiations with the Zhejiang Geely Holding Group, which currently owns Volvo Cars.[47][48] In late March, Fisker hired a law firm to prepare for a bankruptcy filing.[44]

On October 11, 2013, Hybrid Technology LLC agreed to buy Fisker's defaulted government loan, at a heavy discount. On November 22, 2013, Fisker filed its Chapter 11 bankruptcy case. Concurrently, on November 23, 2013, Fisker agreed to be acquired by Hybrid, subject to bankruptcy court approval.[49][50] Hybrid is owned by a Hong Kong billionaire, Richard Li. A court hearing on the proposed sale to Hybrid was set for January 3, 2014.[50] Because Hybrid held the purchased government loan, which it bid as part of its purchase price for Fisker, attorneys for Fisker told the bankruptcy court that no offer better than Hybrid's could be expected.[51] However, at the last moment, another Chinese company - parts supplier Wanxiang Group - submitted a competing bid of US$24.75 million, supported by the Official Creditors' Committee in the case. Wanxiang had earlier lost out to Hybrid in bidding for purchase of the government's loan to Fisker. Wanxiang owns A123 Systems LLC, Fisker's former battery supplier, and Fisker argued that Wanxiang's conduct was partly responsible for Fisker's business failure. As part of its bid, Wanxiang proposed restarting production of the Karma.[52]

Wanxiang received court approval on February 18, 2014 to buy the assets of Fisker after a three-day auction against Hybrid with a bid of US$149.2 million, with bidding starting at US$55 million, significantly more than the previous US$24.75 million bid. Wanxiang claimed that it could restart production, estimating that it would sell more than 1,000 Fisker Karma cars in the first 18 months in the US and 500 in Europe.[53]

Production models

Karma

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Main article: Fisker Karma

The Karma was a plug-in hybrid luxury sports sedan produced by Fisker Automotive and manufactured at Valmet Automotive in Finland. After missing its initial late 2009 launch, and after the launch was rescheduled several times, the first deliveries took place in the U.S. in late July 2011 and deliveries to retail customers began in November 2011.

The 20.1 kWh (72.36 MJ) lithium ion rechargeable battery in each car came from A123 Systems in Watertown, Massachusetts. The aluminum frame was engineered by Fisker and was supplied by Norsk Hydro from Norway. The cabin interior was designed by Fisker Automotive, but was made in the United States by Magna International of Canada. The EVer powertrain system, technically a series hybrid, delivered over 400 horsepower, and was inspired by Quantum Technologies, a co-founder of and early investor in Fisker.[54]

Concept vehicles

Fisker Surf and Sunset

Fisker Sunset concept
The Fisker Surf was unveiled at the 2011 Frankfurt Motor Show

Fisker unveiled the Karma S hardtop convertible concept in 2009.[55]

The Fisker Surf plug-in hybrid concept car was unveiled at the 2011 Frankfurt Motor Show.[56] The Surf would have an all-electric range of 50 mi (80 km) and an additional 250 mi (400 km) when the gasoline engine is engaged acting as a generator to charge the battery pack. Like the Karma, the Surf operates in Sport or energy-saving Stealth modes. In Sport, the car can reach 60 mph (97 km/h) from 0 in 5.9 seconds and the maximum speed is 125 mph (201 km/h). According to Henrik Fisker, the Surf would be part of the company’s lineup and would be available for North American and international delivery in 2013. Price was expected be in the same range as the Karma.[57] In early 2012, the company announced that they're dropping their plans to produce the Surf and the Sunset. Instead, they decided to proceed with production of the Fisker Atlantic.[58]

Fisker Atlantic

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Main article: Fisker Atlantic

In April 2012, Fisker unveiled their model Atlantic at the 2012 New York International Auto Show. The Fisker Atlantic, originally called "Project Nina",[59] shares the range-extender system from the larger Karma, but uses a four-cylinder BMW sourced gasoline engine, which acts as a generator to keep the batteries charged. The Atlantic is rear-wheel drive, with the option of four-wheel drive.[60] The expected all-electric range is 30 mi (48 km).[61]

The Atlantic is scheduled to become Fisker Automotive's second production car, after plans to produce the Fisker Surf and Sunset variants of its full-size Karma were shelved earlier in 2012. Production was initially scheduled to begin by the end of 2012 at former GM plant in Wilmington, Delaware. By October 2012, the carmaker decided to postpone production for late 2014 or 2015 due to financial constraints.[58]

Fisker Force 1

In December 2015, Fisker announced the Force 1 supercar, to be unveiled at the 2016 North American International Auto Show, with production starting shortly after. Priced just under $300,000, the car will be front/mid engine, rear wheel drive, and powered either by a six-speed manual or optional paddle shift auto box. The two-seat Force 1 is also said to feature a carbon fiber body, Ultra Thin Ventilated (UTV) laser blade tail lamps, and 21" wheels with high performance Pirelli P Zero tires, controlled by a new active suspension.[62]

Sales

By February 2012, Fisker had established 45 dealerships in the US and three in Canada.[63] By March 2012, the company had built 2,000 vehicles, with over 500 delivered to customers,[64] and by the end of 2012 Fisker claimed 1,800 cars had been delivered.[65]

The company has partnered with five importers: GP Supercars (Merano, Italy), Nellemann (Copenhagen, Denmark); the Emil Frey Group (Zurich, Switzerland); BD Otomotive (Istanbul, Turkey)[66] and Al-Futtaim Group (Middle East and North Africa).[67]

Manufacturing

Fisker Automotive used to retain core competencies, such as design and marketing, in-house but outsourced all manufacturing of the car and power train.[68] Fisker's outsourcing methods allowed the company a 2–3 year period of development instead of the typical 5 years and at a cost of US$333 million instead of US$1 billion,[68] and claimed that it could make a profit from selling just 15,000 cars.[2] Fisker used to save significant development costs by using pre-engineered components developed by other car companies whenever possible, such as the door handle mechanism which was a General Motors part; Fisker Automotive just paid a royalty to GM for each door handle in the Karma, which was much cheaper than designing its own door handles.[54] However, the A123 battery failure and its resulting recall, and the eventual bankruptcy of the battery supplier,[69] led to significant problems and added cost to the manufacture of the Karma model, finally resulting in Fisker's bankruptcy.

In 2008 Fisker estimated 15,000 cars per year would be assembled by Valmet Automotive in Uusikaupunki, Finland.[70] Manufacturing eventually commenced in 2011 but by the third quarter of 2012 production ceased and Valmet laid off half its workforce.[71]

Investors

Fisker Automotive's investors have included Leonardo DiCaprio,[72] Palo Alto Investors, Kleiner Perkins Caufield & Byers, Qatar Holdings, LLC, A123 Systems and Ace Investments. In April 2012, Fisker announced it had received US$392 million in a round of financing,[38] which was in addition to US$850 million in private investment it had received in previous rounds.[73] In Fisker's bankruptcy case, these investments will be wiped out.[74]

See also

References

  1. ↑ The Documented History of Fisker Automotive - PrivCo
  2. ↑ 2.0 2.1 Lua error in package.lua at line 80: module 'strict' not found.
  3. ↑ Fact Sheet Fisker Automotive
  4. ↑ http://www.ocbj.com/news/2011/jan/23/fisker-strikes-deal-hq-anaheim/
  5. ↑ Lua error in package.lua at line 80: module 'strict' not found.
  6. ↑ Lua error in package.lua at line 80: module 'strict' not found.
  7. ↑ Fisker sued for sudden layoffs
  8. ↑ The Sad Long Story of Fisker Automotive
  9. ↑ Lua error in package.lua at line 80: module 'strict' not found.
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  59. ↑ Lua error in package.lua at line 80: module 'strict' not found.
  60. ↑ Stevens, Tim. "Fisker Atlantic EVer unveiled in New York" EnGadget 3 April 2012. Retrieved 4 April 2012.
  61. ↑ Lua error in package.lua at line 80: module 'strict' not found.
  62. ↑ Lua error in package.lua at line 80: module 'strict' not found.
  63. ↑ Lua error in package.lua at line 80: module 'strict' not found.
  64. ↑ Lua error in package.lua at line 80: module 'strict' not found.
  65. ↑ Lua error in package.lua at line 80: module 'strict' not found.
  66. ↑ Lua error in package.lua at line 80: module 'strict' not found.
  67. ↑ Lua error in package.lua at line 80: module 'strict' not found.
  68. ↑ 68.0 68.1 Lua error in package.lua at line 80: module 'strict' not found.
  69. ↑ Lua error in package.lua at line 80: module 'strict' not found.
  70. ↑ Lua error in package.lua at line 80: module 'strict' not found.
  71. ↑ Lua error in package.lua at line 80: module 'strict' not found.
  72. ↑ Lua error in package.lua at line 80: module 'strict' not found.
  73. ↑ Lua error in package.lua at line 80: module 'strict' not found.
  74. ↑ Lua error in package.lua at line 80: module 'strict' not found.

External links

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