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Fisker Karma
Electric car startup grows thanks to a government loan

Currently, California-based electric car startup Fisker automotive is sub-manufacturing its Karma plug-in electric vehicle through Valmet Automotive in Finland.  Now thanks to a loan of $528.7M USD from the Department of Energy, Fisker is moving the focus of its production -- and the money and jobs that goes with it -- to the United States.

The move became official at a press conference in Wilmington, Delaware this morning.  Joined by Delaware's Governor, Jack Markell, and Vice President Joe Biden, Fisker's founder and CEO Henrik Fisker officially announced his company's plans to purchase a closed GM plant and repurpose it to produce his company's electric vehicles.

The plant was built by GM in 1947 and was last used to produce the Pontiac Solstice and Saturn Sky, both of which ended production last spring.  It is currently owned by Motors Liquidation, the government-organized bankruptcy holding from GM that is seeking to sell off the company's remaining stale assets.  Fisker will get the plant at a bargain price of $18M USD, leaving plenty of its loan funding for the retooling, employment, and distribution costs.  The refurbishing and retooling of the plant is estimated to cost $175M USD and will take three years to fully complete, though partial production may start before that.

The plant sits on a spacious 142 acres of land and features over 3.2 million square feet of floor space.  Once retooled, it will be used to build a new, more-affordable plug-in that Fisker is currently cooking up, codenamed "Project Nina".  Fisker plans to release this new vehicle by 2012 and reach production levels of 75,000-100,000 units annually by 2014 which is well above current Karma production levels.  The company says that half the production will be sold domestically and approximately half of the production will be exported and sold overseas, under his company's current plan.  It is targeting a price of under $40,000 for the vehicle, after federal tax credits, ironically similar to the speculated price of the 2011 Chevy Volt, produced by GM.

Mr. Fisker praised the plan for the new plant.  He describes, "This is a major step toward establishing America as a leader of advanced vehicle technology. Wilmington is perfect for high quality, low volume production and will soon be the proud builder of world-class, fuel-efficient Fisker plug-in hybrids."

Although Fisker's current overseas production plans have caught some flak, more criticism may be raised over the plant's use of unionized labor.  The plant will employ 2,000 workers, mostly UAW members.  The decision to keep the plant unionized is a rather atypical choice for a startup auto firm.  The plant will also lead to the employment of approximately 3,000 supplier jobs in the U.S.

Gary Casteel, UAW director responsible for the plant, cheered the decision to keep the plant unionized, stating, "It gives me great pride to give UAW Local 435 workers the opportunity to partner with Fisker Automotive to create a greener America by building a plug-in hybrid car that will compete globally."



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RE: An EV Startup with Union Workers??
By Spuke on 10/27/2009 6:18:34 PM , Rating: 3
quote:
Yeah, would have pegged "shit canning the union" as task #1.
They kept the union? F$%k! I thought they were just hiring the workers that were there before. In their defense, the workers at that plant are VERY skilled and experienced in small volume, hand built production runs. They were the same people that built the Solstice/Sky/Opel GT and really do know their stuff.

I really can't believe they agreed to have the union there. Those guys would've worked there without the union. WTF happened?


RE: An EV Startup with Union Workers??
By BZDTemp on 10/27/2009 7:29:49 PM , Rating: 4
Fisker is from Denmark and in Denmark almost everyone is organized. The unions are constructive partners and not just opponents so it may well be Fisker is looking for a positive relationship and not the more traditional Boss vs. Union fight.


RE: An EV Startup with Union Workers??
By jdietz on 10/27/2009 9:06:55 PM , Rating: 5
Foreign unions might be cooperative, but UAW and American unions in general aren't. #1 job of union = more money and benefits for union members. They aren't focused on the symbiotic parts of unionship, like worker training.


RE: An EV Startup with Union Workers??
By mcnabney on 10/28/09, Rating: 0
By weskurtz0081 on 10/28/2009 9:45:10 AM , Rating: 3
Because labor is one of the single largest expenses in pretty much any business, and the union is making that labor FAR more expensive. Maybe that's why.


RE: An EV Startup with Union Workers??
By Cerin218 on 10/28/2009 4:24:11 PM , Rating: 3
Really? So someone turning a wrench on a car or plugging in a harness. is harder to replace then someone who can migrate your entire organization from Exchange 2000 to Exchange 2007? Best part about being an IT person is that my field is always changing, and as long as I keep current with technology I will always be in demand. And the kids these days are growing up with it and most couldn't troubleshoot themselves out of a paper bag. Or have the years of experience with all sorts of technology. Technology isn't something you want a low paid or low quality person working on. And no, when it comes to IT, you might be able to find cheaper, but I have found in technology you get what you pay for. I am the only one out of the 120 employees here that can do my job as well as I can. Which is why I get paid more. IT workers don't need a union. We have skills that are in demand. If I don't like what you are giving me or paying me, I will find someone that will. Keep yourself relevant and you don't have to worry about a job. I'd like to see your justification for plummeting IT salaries. Even if they do by some miracle, there are enough uneducated users with malware problems that need to have wireless networks installed. What job does an auto assembler do that would be useful as a side job?


By Lord 666 on 10/28/2009 5:09:31 PM , Rating: 2
And you are the very reason why IT gets a bad rep. Drop the arrogance, share your knowledge with other IT staff on your team, and move onto the next challenging aspect of IT.

Are you management as well as the technology side? Always remember that someone has more experience than you and can get it done faster. Your myopic view is within your organization, not the entire labor pool of IT.

Just some friendly advice... otherwise I agree there shouldn't be an IT union. Even though I wouldn't mind starting one so I can be a millionare and retire soon.


RE: An EV Startup with Union Workers??
By Keeir on 10/27/2009 10:57:47 PM , Rating: 2
quote:
I really can't believe they agreed to have the union there. Those guys would've worked there without the union. WTF happened?


I think your overlooking a few things

#1. The plant in Delaware will only produce "Nina", not the Karma car. Thus, its unlikely production will even start until 2012 at the earliest. 3 years is a long time to go without a job. The UAW contacts might be to maintain the on-site skill training, rather than start from scratch, which could provide -substantial- cost savings. The UAW may also work to bridge the gap between the Kappa and the Nina, allowing a retention of a higher percentage of skilled workers.

#2. Since Fisker Motors is not yet a public company, I don't think the Union contract has to be made public. Although I am sure contract will be leaked, there is nothing that says the UAW contract with Fisker can't be at an end cost to Fisker of 20% less than say GM or Ford. In fact, I could see a wily Union offering Fisker a sweethart deal on the first 0-5 years to ensure the company gets established.

In the long run, this could really screw Fisker, but I don't see it as a major barrier to short term development of profitability.


By Ammohunt on 10/28/2009 10:38:28 AM , Rating: 3
well when you pay a high school drop out $30 an hour to put a few bolts in a car on an assembly line they eventually get good at it when they are not on break or vacation.


"Mac OS X is like living in a farmhouse in the country with no locks, and Windows is living in a house with bars on the windows in the bad part of town." -- Charlie Miller














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