From the beginning, Fisker had a hard, uphill battle. We drove the Karma last year and overall we thought it was a good car. Compared to everyday cars it is excellent. Nice to look at, sit in, and drive. Comparing it to cars in the $100,000 price range though, it doesn’t quite cut it. It isn’t as refined as a Mercedes-Benz S-class, not as good to drive as a BMW 7 Series, or as good looking as an Audi A8. Still, it isn’t an eye sore or a Toyota Prius. The car didn’t sell too bad either. In less than a year they sold just over 2,000 Karmas before trouble really set in.
Fisker’s rough journey started back when they were approved for a $300 million loan from the U.S. Department of Energy. This loan was a good thing and a bad thing at the same time. Good because they had the backing of the Government but bad for the same reason. Because of this loan, the Karma was rushed. The Government wanted it out by a certain date so the product didn’t get proper testing. The period from concept to on sale was only 47 months. That may seem like a long time, but when comparing it to the Tesla Roadster‘s five year development time for a car that was already based on a proven platform adds a little perspective.
The bad luck struck home once the car was launched in 2011. There were immediate problems with the car. Most of which were simply due to the lack of development testing. Simple flaws with the infotainment center or the car locking itself while charging. Bad press didn’t help either when Consumer Reports purchased a car for testing and it went into limp mode to protect the batteries. The car did exactly what it was designed to do. But the fact that it did it in the first place was not only misunderstood but also a way to attack Fisker for producing a “faulty” product.
Last summer things got worse when their battery supplier, A123, filed for Chapter 11 and Fisker had no means or time to design and test a new battery pack. Production was ultimately put on hold in July of 2012. Hurricane Sandy hit months later wiping out 330 cars which were sitting at a port to be shipped.
The last few weeks have really shown how the company is struggling. Last month founder of the company, Henrik Fisker, resigned and left the company completely over a disagreement to do with the now frozen DoE loan and how to get the rest of the promised $300 million(they were only paid $169 million) and just last week the company laid off 160 employees, 75% of the company, a move which resulted in a class-action lawsuit against the company lead by a former employee claiming they were laid off without proper warning. On top of that, word has it that Fisker execs are speaking with bankruptcy officials and could be filing for Chapter 11 as soon as this week and the DoE is demanding payment on the loan.
So where did they go wrong? Perhaps it can be pinpointed back to the Government loan which was never paid out in full and put them under a loaded gun to get the product out. Or maybe it was the fact that they built the Karma and showed a convertible and shooting brake concepts of the cars. Money which could have been spent on perfecting the current version until they got it right. Then they revealed the Atlantic concept. The car they should have started with. It would have been cheaper to develop and build as well as being a car more people could have afforded. Perhaps the combination of all these things lead them to the circling of the toilet bowl. And that makes me sad.
It makes me sad because of what could have been. If the car had been allowed real development time, if it had been more affordable, and if it had met the promised fuel consumption then perhaps this could have been the car of the future. Instead, we get the Nissan Leaf and the Chevy Volt. Neither are good looking and neither are particularly great cars either. This is where the eyes of the world turns its head back to Tesla and its new Model S.