Why is Fisker Automotive’s Karma both a Failed EV and a Negative Fate?
Called the “Solyndra of Electric car companies” by Bill Vlasic of the New York Times, Fisker Automotive is just the latest in long line of investments by the U.S. government into questionable technologies and companies.
Fisker’s jagged history is best summarized in “47 depressing facts about Fisker’s epic electric car failure,” that appeared today in the Washington Examiner. Among these facts, the article points out:
• In 2009, the untested Fisker Company secured loan guarantees from the Obama administration totaling $529 million, more than the company had initially requested. - Wall Street Journal
• In 2009, the company claimed the Fisker Karma would get 67.2 MPGe and 50 miles of electric range. In October 2011, the EPA rated the Karma with 52MPGe and 32 miles of electric range - Engaget
• In 2011, Fisker only shipped about 1,500 Fisker Karmas. The production goal for 2011 was 7,000. - Autoblog
• On April 7, 2013, Fisker laid off 160 of its roughly 210 employees – Autonews
• The Fisker plant in Delaware was reportedly ‘absolutely empty’ on April 17, 2013 – Delaware News-Journal
• A123, the sole supplier of lithium-ion batteries for the Karma, went bankrupt in October 2012. - New York Times
• In December 2011, Fisker recalled the first 239 Karma plug-in hybrids due to a fire hazard. – New York Times
• In May 2012, a Fisker was blamed for starting a fire in Texas that burned the owners house to the ground. - Autoweek
• In August 2012, a Karma caught fire in a California parking lot – ABC News
• One owner, an Austin, TX-based programmer, recorded a 41-minute video about how bad the car’s control panel was. - YouTube
• During a Consumer Reports test drive, the Fisker Karma broke down – Digital Trends
• More than a dozen Fisker Karma’s caught fire and exploded at a New Jersey Port after Hurricane Sandy – Jalponik
Related article: Verizon Prepares for $100m Renewable Energy Investment
An Editorial by Charles Lane, Washington Post provided additional insight into the rise and fall of Karma and possibly the industry itself:
“….. Fisker attracted $1.1 billion in private investment, the vast majority of which took place after it got the DOE loan.”
“….. government loans could not overcome Fisker’s fundamental problem: no experience mass-producing automobiles, let alone the complex battery-powered luxury cars that it proposed to sell for more than $100,000.”
“….. the company is nearly bankrupt; taxpayers are on the hook for $171 million, and private investors are probably nearly wiped out.”
“…..that’s more than a billion dollars in capital that can’t create jobs elsewhere in the economy — but might have, if the government had not propped up and promoted Fisker.”
“Government can efficiently affect energy usage through fuel taxes and basic research. When it intervenes on behalf of specific technologies and specific companies, however, bad things happen — resource misallocation, windfall-seeking, even, sometimes, corruption.”
Related article: Why Reserves have no Impact on Energy Abundance
ADVERTISEMENT
In closing, it’s easy to blame the government, the company and the technology. Rather failure falls on one simple entity – People. People’s belief in a government can fix all mentality. People’s belief that a management team with questionable ability can successfully run a company with a pricy product in a nascent industry where others fail to tread. People’s belief in an unproven technology littered with fragments of technical issues. Other than the EV industry, the only other sector that operates with such poor odds is gaming. Show me a player rich from gambling alone and I will show you a liar.
The opinions expressed in this article are solely those of the author Dr. Barry Stevens, an accomplished business developer and entrepreneur in technology-driven enterprises. He is the founder of TBD America Inc., a global technology business development group. In this role, he is responsible for leading the development of emerging and mature technology driven enterprises in the shale gas, natural gas, renewable energy and sustainability industries. To learn more about TBD America, please visit: http://tbdamericainc.com/
By. Barry Stevens
