But good looks and hi-tech alone aren’t enough. The Atlantic was planned to be the first car from Fisker’s new factory in Delaware, a former GM plant closed during the financial crisis. But its introduction will be delayed by financial uncertainty. The US Department of Energy has suspended Fisker’s access to the US$25bn Advanced Technology Manufacturing Loan Program, announced by the Obama administration in November 2008 in an attempt to resuscitate the then-dying US car industry. Fisker won approval for a US$529m loan but has only drawn $193m, of which $169m was spent on the Karma. The DoE says Fisker missed some of the milestones it set for bringing the car to market, and won’t release any further cash until it has set new targets and completed further due diligence on the California-based business. Fisker says he now wants to repay the loan and instead raise the capital needed to put the Atlantic into production from investors. Fisker raised another US$130m in March, bringing the total raised from private equity to over US$1bn.
The firm has also been caught up in the US Republican primary debates. Mitt Romney labelled the loans to Fisker and Tesla ‘crony capitalism’ and has called for a House investigation into President Obama’s scheme, of which Ford and Nissan were also beneficiaries. To add to Fisker’s difficulties, an independently-purchased Karma broke down during testing by US magazine Consumer Reports. A battery problem was diagnosed which has forced Fisker’s supplier A123 Systems to offer to replace the packs in all 700 Karmas delivered.
The firestorm surrounding Fisker contrasts with the situation at fellow ‘New Detroit’ carmaker Tesla, which is further advanced with its Atlantic-rivalling, all-electric Model S. Tesla’s share price hit an all-time high in the run-up to the New York show. But analysts back Fisker to establish itself as a premium American car brand. And nobody every said it would be easy.
