What do you get for $193 million? A dead battery.
Consumer Reports tried to test the Karma, a $100,000 electric car creation of Fisker Automotive, but it died and wouldn’t restart on the test track. Fisker engineers couldn’t even come up with a reason to explain why the car failed to run.
Fisker has drawn $193 million on a $529 million loan from the Obama Administration to develop the plug-in car, but according to tech industry reports, the company finds itself “in turbulent times.” Having your invention die on the test track isn’t likely to help turn that around.
Last month, Fisker changed its CEO and announced it was forced to renegotiate the terms of the DOE loan because the company “missed milestones in getting its first vehicle, the Karma sports car, to market.” The first car was three months late coming out of the manufacturing plant, and buyers haven’t warmed to a $103,000 electric experiment.
In a pattern that has become all too familiar with DOE loan recipients, Fisker was forced to start laying off workers in their California manufacturing plant in February.
A few weeks ago, GM announced it was “halting production” of the Chevy Volt, another electric experiment, because it wasn’t selling. According to published reports only 1,626 Volts have been sold through February. GM had planned to manufacture 60,000 of them and sell 45,000 in the U.S. this year. Energy Secretary Stephen Chu brags that the government has dumped $5 billion into developing electric cars like the Volt. In addition, there is a $7500 direct subsidy for each car sold. Obama’s solution for the anemic sales? Increase the subsidy by 33% to $10,000.
If that doesn’t work, we understand the President is in negotiations with Santa Clause to put a Volt under Christmas trees.
NEW TIME Today, at 9:30 AM PT: Get the Market Movements in Advance; Williams Edge Webinar for January 26th, 2014 | John Ransom