It looks like Henrik is going to be working for the Chinese.
That would be Henrik Fisker, the co-founder and executive chairman of Fisker Automotive Inc. of Anaheim, Calif.
Every time I’ve spoken with Henrik, generally after one disaster or another, he has been unfailingly confident and optimistic. Oh, he would say, there’s no big problem when his electric luxury car, the Karma, was years late or when his battery supplier went bankrupt and he had to cease manufacturing or when cars that were built were recalled for battery fires, or more recently, when 338 Karmas were destroyed by Hurricane Sandy and his insurance company refused to pay.
It’s the nature of an entrepreneur to think boldly and act bravely, but it looks like this one is nearing the end of the line in terms of managing the company that carries his name. Rumours of impending bankruptcy surfaced in December and, more recently, news reports from both the United States and China have suggested three Chinese firms are kicking the tires and one will likely be the new controlling partner.
Henrik is a great automotive designer with terrific creations both at Aston Martin and BMW before going it alone. He successfully promoted his luxury electric car dreams to the usual suspects in Silicon Valley and raised undisclosed hundreds of millions in venture capital from private equity investors. The high-flying investment firm Kleiner Perkins, Caufield and Byers – where former U.S. vice-president (and Karma owner) Al Gore is a partner – is heavily invested in Fisker. So are taxpayers, as Fisker secured various green technology loans and grants from Washington.
Things got complicated for Fisker Automotive when its battery maker A123 Systems went bankrupt and stopped supplying batteries. Fisker stopped production last summer and went looking for new investment. A123 had also been the beneficiary of massive government loans and there was a fuss when it and all its technology was purchased cheaply by China’s Wanxiang Group. A potential repeat scenario could be playing out if Fisker is also purchased by a Chinese company and U.S. taxpayer-supported technology ends up in the hands of its top economic rival.
Republican Senator John Thune of South Dakota said recently: “[President Barack] Obama’s green energy investments appear to be nothing more than venture capital for eventual Chinese acquisition. After stimulus-funded A123 was just acquired by a Chinese-based company, it’s troubling to see that yet another struggling taxpayer-backed company might be purchased under duress by a Chinese company.”
China certainly intends to be the world’s leading producer of electric cars. It already is the world’s largest single automotive market and, having missed the boat in the development of gasoline-powered cars, it doesn’t intend to be left behind by anyone in electrics.
According to news reports from both sides of the Pacific, the interested purchasers of Fisker include China’s Geely Holding Group, which bought Volvo from Ford for $1.8-billion in 2010. Another is said to be the Chinese state-owned company Dongfeng Motor Group. The third is Wanxiang Group, the buyer of A123, which had Fisker as its top customer.
Fisker Karmas are few and I have never had the opportunity to drive one. They are handsome, and batteries and all, each weighs a substantial 5,300 pounds. There was a plan to get government money to enable Fiskers to be built at an old GM plant in Delaware, but that fell through. Until the battery supplier went under, Fiskers were assembled in Finland. The Karma, like the Chevrolet Volt, is a battery-powered car with a small gas engine built in as a charger.
Tesla Motors Inc., another electric car company financed from Silicon Valley, has significantly outperformed Fisker to date in both production and sales. Nevertheless, you have to give Henrik credit not only for designing and building one of the world’s first production plug-in hybrid electric vehicles, but also as a pioneer in the premium green-car segment that almost every manufacturer is trying to get into today.
The road followed by an entrepreneur has twists and bends and, in Henrik’s case, it now appears to run through China.