A new CEO for the deeply troubled extended-range luxury electric vehicle maker.
Fisker Automotive, a VC-funded extended range electric vehicle maker, just moved co-Founder Henrik Fisker to Executive Chairman of the firm, and appointed Tom LaSorda as CEO and Vice Chairman of the Board.
Former Fisker Automotive co-founder and CEO Henrik Fisker (right) had a visit from U.S. Vice-President Joe Biden (left) at Fisker Automotive's Anaheim HQ on October 29, 2009 (Click Image To Enlarge)
LaSorda was formerly CEO, President and Vice Chairman of the Chrysler Group and also held executive positions at General Motors.
New Fisker Automotive CEO Tom LaSorda replaces Henrik Fisker (Click Image To Enlarge)
The firm has raised more than $800 million in private equity and produced only a few hundred vehicles, amidst recalls, DOE loan issues, and layoffs. Ray Lane, former Chairman of the Board, will take a "lead director role" according to a press release from the firm. Lane also shepherded Next Autoworks (the former V-Vehicle) into its current situation.
Click Images To Enlarge
High-end hybrid carmaker Fisker Automotive has stopped work at its Delaware Project Nina plant and laid off 66 workers, and is renegotiating its $529 million Department of Energy loan amidst news that it has been blocked from accessing the money since May.
It’s bad news for Fisker on top of bad news that’s been filtering out for months. The Anaheim, Calif.-based startup has continually delayed the sale of its Fisker Karma plug-in hybrid sports car. That’s hurt lithium-ion battery maker and partner A123 Systems, which laid off about 125 employees in November and lowered its annual revenue forecast, a move blamed largely on Fisker’s delays.
At the same time, Fisker has been renovating an old General Motors plant to build its next-generation “Project Nina” lower-cost plug-in hybrid sedans. That’s the reason it won a $529 million AVTM loan in 2010, and the project it has now halted as it seeks to renegotiate its loan.
So far, Fisker has drawn on about $193 million of the $529 million AVTM loan, which leaves $336 million yet to tap. The loan actually laid out that Fisker could spend about $169 million on Karma engineering and $359 million on its Project Nina plans.
Fisker spokesman Roger Ormisher told reporters that access to the loan has been blocked since May. Neither party would talk about the renegotiation underway. But DOE spokesman Damien LaVera told Bloomberg that the agency has “strict conditions in place to protect taxpayers. The department only allows the loan to be disbursed as the company meets certain milestones and demonstrates results.”
The DOE’s greentech loan program has come under intense scrutiny since Solyndra declared bankruptcy in October. The thin-film solar module startup landed a $535 million DOE loan in 2009, but looks to be unlikely to be able to pay much of it back. Closer to the automotive industry, lithium-ion battery maker Ener1 filed for bankruptcy protection last month, after receiving a $198 million DOE grant.
Fisker has raised about $850 million in private capital from investors including Kleiner Perkins and A123. That includes $260 million in 2011, most recently with a $150 million round launched in November.
But it’s also struggled to deliver on its $102,000 luxury plug-in Karma, with only 225 vehicles sent to dealers and another 1,200 in the pipeline, CEO Henrik Fisker said in December. At the same time, its DOE loan was made conditional on the company delivering a cheaper mass-market model built in the United States, not by Finnish contract manufacturer Valmet, as today’s Karma models are.
Fisker’s Project Nina plant is also backed by $21 million in Delaware state loans. Fisker bought the site in late 2009, started hiring workers in July and had hired about 100 people as of late 2011. Monday’s layoffs included about 26 Delaware employees and about 40 at its headquarters.
Making cars is expensive, and Fisker must prove it can control those costs as it moves from contract manufacturing collectors' items to building mass-market cars on its own. In that sense, its rival is Tesla Motors and that company's Model S sedan -- but it’s also fighting against auto giants like Nissan, GM and all the rest. Having its first U.S. factory put on hold can’t be reassuring to would-be investors in its hoped-for IPO.
COMMENTARY: In a previous blog post dated February 8, 2012, I reported that the Department of Energy had refused to allow further drawdowns on a $529 million loan, because Fisker Automotive had failed to meet the DOE's production and sales milestones. Fisker announced layofs of 26 employees from its "Nina" plant in Delaware and speed up layoffs of 40-45 engineers at its Anaheim, California headquarters.
Unless Fisker Automotive can lower its production costs and obtain additional financing, it will probably be unable to deliver the remainder of its Karma backlog, have to layoff even more employees, and may endup declaring bankruptcy and shutdown production altogether.
In my opinion, moving co-Founder Henrik Fisker to Executive Chairman of the firm, and appointing Tom LaSorda as CEO and Vice Chairman of the Board is just a cosmetic change, and not really going to help Fisker Automotive make cars. In fact, having so few workers left, amounts to a slow death if you ask me.
As far as I know, no one is going to come in and bailout Fisker Automotive through an acquisition. That $1 billion+ in total debt is like a heavy anchor weighing down the company. Their only hope is a white knight who could come in an acquire the company, but who would be crazy to do that? As far as I am concerned, Fisker Automotive is a dead duck waiting to happen.
Courtesy of an article dated February 28, 2012 appearing in GreenTechMedia
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