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For Wanxiang, job one at Fisker is fixing roughly 250 bugs with the Karma luxury car before production can resume. After that, the goal is to launch a second model.
Under its new Chinese owner, Fisker might be back to selling its plug-in hybrid luxury sedans by next year.
Production of the Fisker Karma might finally resume within a year under the company’s new Chinese owners.
VL Automotive’s plans to build a series of Corvette-powered revisions of the Fisker Karma range-extended electric vehicle is moving ahead.
Wanxiang Group’s purchase of A123 Systems Inc. has been approved by the U.S. government, despite concerns of sensitive technology being transferred to China.
Bankrupt battery manufacturer A123 Systems expects its sale to Chinese firm Wangxiang to be complete in a little over a week.
A lot full of Fisker Karmas was exposed to the full brunt of Hurricane Sandy’s force, and after the storm cleared, 16 of them had caught fire, and burned out completely.
The automotive industry is a global business that is constantly evolving and growing, and we here at AutoGuide know it can be hard to keep up sometimes. So here is a summary of the top stories you may have missed this week:
Ford recently announced the EPA fuel efficiency rating for its electric Focus model. Since it doesn’t burn any gasoline, the number isn’t in miles per gallon (MPG), but was given as miles per gallon gasoline equivalent, or MPGe. A new term to the automotive lexicon, it’s worth exploring exactly what MPGe means and how an MPGe rating is determined, especially as the number of electric cars and plug-in electric hybrids on the roads continues to increase.
Start-ups are inherently risky and while many bright-eyed visionaries initially display great potential, up to fifty percent of new enterprises run out of money. Unfortunately, Waltham-based A123 Systems Inc. are at risk of becoming a statistic.
Earlier this month, Consumer Reports reported that a brand-new Fisker Karma plug-in hybrid electric vehicle with less than 200 miles on the odometer abruptly shut down. News of the defect spread quickly, causing Fisker engineers scrambling to identify and solve the problem as soon as possible in an attempt to curb any damage to consumer confidence. Investigators determined the cause of the issue as a flaw in the Fisker’s battery module, which is supplied by A123.
Other than the incident at Consumer Reports, A123 CEO David Vieau told reporters that five Fisker customers are potentially affected by the flawed battery packs. As of March 26, A123 has started building replacement modules for Fisker and will begin to ship these battery packs out to customers this week. Despite moving forward, David Vieau admits that the cost of replacing the batteries will “require us to adjust our fundraising strategy.” Vieau did not elaborate.
Caused by faulty calibration in one of four welding machines, a misalignment of the components in some cells could lead to an electrical short, resulting in the permanent failure of the A123 battery or a decrease in performance and battery life. In order to replace all the defective battery packs, expense figure estimates are close to $55 million, which “represents a severe impact” on cash reserves, stated Dan Galves, New York-based Deutsche Bank analyst.
Galves wrote in a report, “We no longer have enough confidence that AONE can raise sufficient capital (without massive equity dilution) and/or continue to augment their book to future business. Recent quality issues may lead to concerns over AONE’s ability to manufacture with quality at high volumes, potentially leading to customer defections or at least difficulty in procuring new contracts.” AONE refers to A123′s stock symbol.
According to financial reports, A123 held $187 million in cash at the end of 2011 but Galves pointed out A123 suffered a cash burn of at least $155 million this year. The company will have to raise at least $50 million of additional short-term capital but, unfortunately, loan requests will be extremely difficult due to a general lack of confidence due to weak first-half results, long-term profitability concerns, pressure on battery pricing, and uncertainty on EV demand.
Dan Galves changed his rating on A123 from “buy” to “hold.” AONE share price have fallen 6 percent to $1.40 yesterday.
Apparently the luxury EV is meant to shut down in the event of a failure to prevent collateral damage that might otherwise result. LaSorda sent a letter to customers apologizing for the fault and any resulting inconvenience.
He also assured customers that he is “personally involved” in all the company’s initiatives, saying that hiccups in new technology sometimes require updates and refinements.
Fisker returned the Consumer Reports owned Karma fully repaired under warranty after finding a problem in the car’s inverter cable and battery.
Furthermore, it seems LaSorda dispatched what he calls a “SWAT” team of 50 engineers and other consultants to find problems with the car and fix them. New software has been developed to help prevent future problems in Karmas, and will be sent out as soon as the current testing procedure is complete, according to LaSorda.
Regardless of what he says, its hard to imagine buying a car for $107,850, as Consumer Reports did, only to have it die. A letter from the company’s CEO would probably offer little comfort after realizing your recent six-figure investment wasn’t ready to be sold.
GALLERY: Fisker Karma
[Source: Automotive News]
UPDATE: The Fisker employee in question was revealed to be a Fisker retailer employee and not someone who would have inside knowledge of the company. Fisker addressed the claim, saying the information divulged by that individual is untrue. The former employee now works with EV maker Coda.
The Fisker Karma suffered a struggle-ridden launch, including a fire risk recall and a dismal Consumer Reports test. Now a former Fisker employee says the car went to market before it was production ready.
The company apparently pushed the Karma to market faster than it should have because of Department of Energy stipulations that set a timeline release on vehicles using DOE subsidies. Pending a failed timely release, the company would have lost its $529 million loan.
Another factor in the equation is Fisker’s poor financial state, which seems to have spurred the company toward rash decisions meant to keep loan money intact.
Further suggesting that the company is in dire straights, Fisker just announced a new CEO, and internal re-working of the company. Nevertheless, the company said in a recent press conference that it expected to be profitable in 2013. That statement, however, came before the most recent news that could prove to be a significant drain on sales.