Fisker Lays Off Most Workers, Plans To Shop Around Remaining Assets 276
After being saddled with a half-billion dollars in loans from the U.S. Department of Energy, electric car manufacturer Fisker just can't catch a break. It's not just the cars; it's the company itself. From a Reuters report: "In a statement, Fisker confirmed that it let go about 75 percent of its workforce. The automaker said it was 'a necessary strategic step in our efforts to maximize the value of Fisker's core assets.' A Fisker representative could not immediately answer questions on the company's financial position. In the past, the automaker has declined to comment on the possibility of bankruptcy. ... About 160 employees were terminated at a Friday morning meeting at Fisker's Anaheim, California, headquarters, according to a second source who attended the meeting. They were told that the company could not afford to give them severance payments."
How many times do we have to go through this? (Score:5, Informative)
A loan guarantee is not the same as a loan. Fisker was "saddled" with over half a billion in loan guarantees but not with actual loans. You know, dollars? The government froze their credit line under 200 million. Saying Fisker is "saddled" with every dollar from a loan guarantee is like saying I'm "saddled" with every dollar of my $30,000 credit card credit line even though I owe $0. Does that make sense at all to anyone?
And this company failed due to the current trend in American economics. Mr. Fisker wanted to invest and build to create a product to sell. The board wanted to do nothing in an effort to save cash. So Fisker left and the board said, "great! now fire everyone, don't produce anything, and will save loads of cash! Surely success will come!" For the exact opposite line of thinking, see Elon Musk who innovated, invested, and built a product that people would want. But the captains of industry, who we are told deserve the most reward because they take the most risk, don't take shit for risks. They want to sit back and squeeze dollars out of what they have instead of actually producing more. So we have Hostess, that didn't want to compete but just rely on brand-name recognition, and the RIAA/MPAA that wants to copyright everything to infinity so no one has to produce anything of value ever again. Thanks, guys!
Re:And nobody learned nuthin' (Score:3, Informative)
Re:How many times do we have to go through this? (Score:5, Informative)
And this company failed due to the current trend in American economics. Mr. Fisker wanted to invest and build to create a product to sell.
This company failed becuase it had a poorly engineered product, with outsourced drivetrain, and outsourced production. That product was one of the most unreliable cars produced in the 21st century so far in an era when cars are getting more reliable.
Mr. Fisker most likely departed because he wanted out of a sinking ship. There was no investing to save this turkey.
Re:And nobody learned nuthin' (Score:4, Informative)
Re:Tesla will be next. (Score:4, Informative)
I saw this one coming (Score:5, Informative)
I am quite familiar with the whole Fisker saga since one of my relatives bought a Karma last year. I tried to talk him out of it. When I test drove the car the software was extremely buggy, not even alpha quality IMO. The entire drive the car kept going "bong bong bong" because it was stuck in some self parking mode that the dealership couldn't get it out of. The car was sexy looking IMO, but it had a lot of serious issues going for it too.
The car is big yet the interior is quite cramped with the huge battery occupying the entire center of the car. Acceleration was nice, up to around 30-40MPh. The software on the center touch screen looked cool, when you could see it, but was quite buggy and not easy to use, especially while driving. For such an eco-friendly car it also only got 20MPG on gasoline and got a combined EPA rating of only 50MPG. The car is quite heavy, over 5300LBS.
Fisker's problem is that they outsourced their engineering. The drive train was done by Quantum Technologies and the battery by A123 systems, both heavy investors in Fisker. Fisker promised to sell 15-20K Karmas which A123 bet the farm on.
Then there were the fires, for one of which the cause was never explained. While the battery wasn't the cause the perception was there. Next was the Consumer Reports debacle. The car completely died early in their testing and it was determined that the battery was defective. This resulted in a battery recall which was the final nail in A123's coffin leading to their bankruptcy. A123 was already in big trouble since Fisker sold far fewer cars than they had promised. In fact, even though Fisker hasn't made a single new car since July of last year you can still find plenty of unsold Karmas at most of the dealerships.
My relative loves his Karma, but the car has been in the shop way too many times in the last year, sometimes being towed in and some of the issues have been rather serious. Other issues are just unexplained.
Fisker was all about image and styling using outsourced technology. When some Chinese investors looked into the company they realized that they didn't have all that much in terms of technology, and in fact their technology was rather mediocre in many ways and needed some serious refining. There were issues between the engine and generator, plus they used two synchronous motors in order to get enough power to move the car and to help overcome torque ripple issues (from what I gather from their patents).
For a first car from a new car company the car was overly ambitious and was far more complicated than I think they realized. Because it was so late the car was rushed to market with a lot of serious issues and inadequate testing. The car underperformed in almost every way. The federal government cut off their loan before they could draw it down all the way.
Their next car, the Atlantic, was to be built in a shuttered Delaware factory but that car also suffered from a cramped interior.
Fisker also burned through a lot of cash without a lot to show for it. They never did anything with the factory they purchased other than stick it to Delaware.
A lot of people compare Fisker to Tesla which is an apt comparison. I am even more familiar with Tesla, having bought a model S myself. Unlike Fisker, Tesla developed their own technology for their Roadster. They developed the battery and drive train and perfected it, once they moved away from the problematic 2-speed transmission.
Tesla's battery solution was to use inexpensive off-the-shelf batteries and to perfect their battery management technology. Unlike Fisker, who uses an expensive custom battery pack Tesla's battery packs are stuffed with over 7000 18650 cells. The 18650 lithium cell is about as standard as it gets. Their drive train is much more compact than Fisker as well. They use a single induction motor that provides about as much power as the pair of motors Fisker uses but without requiring expensive rare-earth metals. Tesla's motor has no magnets in it.
While the Fisker Karma and
Re: And no one will learn yet again. (Score:4, Informative)
The loan was part of a $25 billion DOE program towards greater fuel efficiency of which $8 billion was dispensed before any was allocated to Fisker.
Other recipients were Toyota, Ford, Nissan and Tesla, who collectively nabbed most of that $8 billion.
The loan guarantee was supposed to be towards a planned $40k hybrid, not the luxury Karma. Although the guarantee was for up to $529 million, the loan was frozen back in late 2011, at which point Fisker had borrowed $193 million.
Re:Another one bites the dust (Score:3, Informative)
Most of the projects the DOE funded are doing quite well, and they've exhausted less than 10% of the money set aside for losses in the program. But don't let facts stop you.