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Print 13 comment(s) - last by Ringold.. on Apr 11 at 3:15 AM

Fisker's attorneys have already drawn up bankruptcy papers

It's clear that Fisker Automotive has been struggling, and we may see the result of that struggle as early as this week when the automaker is expected to file for Chapter 11 bankruptcy. 

According to Reuters, Fisker's attorneys have already drawn up bankruptcy papers and will file within the next few days. 

The automaker's board of directors will talk their options over at a meeting today and make a decision regarding the Chapter 11 filing's timing. 

Fisker's upcoming bankruptcy filing comes as no surprise, considering the company has been in a rut ever since its federal loans from the U.S. Department of Energy (DOE) were frozen back in 2011. 

In April 2010, Fisker received $529 million in DOE loans progress development of high-tech vehicles. However, Fisker fell a little behind on its production schedule, and in May 2011, DOE froze the loans due to "unmet milestones." Fisker had only drawn $193 million of it at that point. 

 
Due to these frozen loans, Fisker is having a hard time securing funds to make its second car -- the Fisker Atlantic. Fisker is now looking for investors to help out financially, but the company's investor solution has drawn a lot of criticism because two potentials have been Chinese companies -- Zhejiang Geely Holding Group and Dongfeng Motor Group Co. This is seen as an issue because Fisker received U.S. taxpayer dollars to fund its Karma plug-in. 

The Karma itself has had to be recalled in the past too, as battery supplier A123 Systems (which went bankrupt last year and was later acquired by Chinese firm Wanxiang Group for about $260 million) vowed to replace nearly 600 Karma batteries for $55 million in 2012. 
 
Last month, things started getting worse for Fisker when Henrik Fisker, who co-founded Fisker Automotive in 2007, stepped down as executive chairman citing "several major disagreements" with "Fisker Automotive executive management on the business strategy."

Only weeks ago, the company was forced to put its U.S. workers on furlough to try and keep costs down while it searches for an investor. This means that the U.S. workforce had a temporary, unpaid leave until the company got back on its feet. 

However, Fisker employment took a much bigger hit earlier this week when it laid off 75 percent of its workforce (or about 160 employees). As if this wasn't bad enough, Fisker is now facing a federal lawsuit that accuses the company of not giving employees advanced notice of the mass layoffs. Under the U.S. Worker Adjustment and Retraining Notification Act, workers are supposed to have 60 days notice before being laid off.

Fisker Automotive is expected to make a loan payment to the DOE on April 22.

Source: Automotive News



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Fact
By Ammohunt on 4/10/2013 11:34:42 AM , Rating: 2
Expensive EV cars will continue to be a niche market; playthings possessed only by the rich and famous for feel good purposes. Hybrids are getting better and better and they are the future of everyday automobiles




RE: Fact
By BRB29 on 4/10/2013 11:50:41 AM , Rating: 4
500 vehicles a week equates to 26k a year. That's just Model S. i wouldn't call that a niche market especially when demand is exceeding supply at the moment.


RE: Fact
By Ringold on 4/11/2013 3:12:42 AM , Rating: 2
Compared to the number of cars sold in just the US, much less the world, every year then yes, absolutely 26k cars is a niche. It's almost a rounding error.

According to my math, China alone sells that many cars every ten hours. Ten hours. It'd make up, if sold only in China, .1% of that market.

Total global auto production in 2012 was 81 million. 26k is therefore .03% of the global market.

Another interesting fact: The wiki page on the automotive industry, despite Wiki's left-leaning tendencies, can't even summon the BS necessary to even mention the words "EV" or even "hybrid" on the wiki page.

If you're really going to say it's not a niche market, only two possibilities: 1) You're a troll 2) Don't understand the definition of the word niche.

Anyway, you also lose points on marketing. Of course demand is made to appear to outstrip supply. Makes it look hot, especially a luxury item. Notice the religious spectacle outside any Apple store every time a new iPhone is released. But when normal companies are truly facing production shortfalls, they boost supply, FAST.

Even Boeing I think just recently boosted expected production rates, and something tells me its a little harder to make Dreamliners faster than it is little EV's.


RE: Fact
By Ringold on 4/11/2013 3:15:10 AM , Rating: 2
Not that I don't have faith in the future with Elon Musk... I'm just not about to suggest with a straight face that the reality of TODAY is some sort of fantasy happy land with EV's being any significant sort of market at all.


RE: Fact
By Dr of crap on 4/10/2013 12:48:11 PM , Rating: 2
Hybrids are not the future.

Have you seen the sales numbers. I do not remember the exact number but it was around less than 10% of total car sale is hybrids. UNTIL something BIG happens, it will remain that way.


Gross incompetency
By alpha754293 on 4/10/2013 9:22:32 AM , Rating: 2
From working with them - they're extremely incompetent. They tried to outsource pretty much all of the work (very little of it was actually done in-house by Fisker themselves) and yea...well...you now can see how that worked out for them.




RE: Gross incompetency
By AntiM on 4/10/2013 9:37:09 AM , Rating: 3
quote:
Fisker had only drawn $193 million of it


No doubt the executives received nice salaries, bonuses, and will receive a nice severance package. Of course the lawyers have to get paid. The fact that they outsourced so much leads me to believe they had no intention of forming a viable company from the start.


RE: Gross incompetency
By half_duplex on 4/10/2013 9:55:28 AM , Rating: 2
I think you're on to something.

Wasn't there a similar lib vote getting project that involved solar panels or something like that?


RE: Gross incompetency
By FITCamaro on 4/10/2013 9:57:56 AM , Rating: 2
Shhh......keep that on the down low.


RE: Gross incompetency
By FITCamaro on 4/10/2013 10:56:29 AM , Rating: 2
How about its just beyond the authority of the federal government to play venture capitalist. I wouldn't care if they were failing if they hadn't received our money.


this took longer than expected
By BRB29 on 4/10/2013 9:26:06 AM , Rating: 3
Fisker has not done anything innovative besides designing for looks. They always use other companies' tech. Tesla had looked 100x better since the beginning and pretty much made their vehicles from scratch.

The only surprise here is why it didn't go bankrupt earlier.




By FishTankX on 4/10/2013 9:46:30 AM , Rating: 2
well the roadster body was from elise but I'll .agree.fesla did almost everything from scratch


Just forget them, look at Tesla
By kensiko on 4/10/2013 9:16:45 AM , Rating: 2
We should keep our eyes and money for Tesla, looking to be in much better shape. I was excited when I saw the news about 500 EV cars a week.




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