Fisker Automotive CEO Henrik Fisker is doing some major damage control after the Department of Energy announced that loans totalling roughly $336 million would not be issued to the company. Fisker Automotive is apparently seeking private equity funding to solve what’s being called a temporary cash-flow issue, but the company may be facing deeper problems than that.
A123 Technologies, a major battery supplier for Fisker, cut its revenue forecast by 20 percent off upon news of Fisker reducing vehicle production. A123 has seen its payroll decline by 300 workers since July of 2011, and the Boston Globe is quoting an analyst who thinks that the DOE’s loans are dead in the water, a development that will bring down both Fisker and A123 Systems.
Fisker is also being sued by a California investor who says that Fisker demanded nearly $84,000, or else the investor would lose certain rights that came with his stock issue, such as a protection against share dilution. Fisker has delivered 250 examples of the Karma so far, but has missed a number of deadlines contingent on continuing DOE loans – which are needed to make the more affordable Fisker Nina EV. Government loans for any green technology are a political third rail right now (can anyone say Solyndra). Republican candidate Gov. Mitt Romney slammed the loans as “crony capitalism”, and Fisker himself seems averse to taking any government funds.
The press drive for the Karma was held just recently, and Fisker’s company line ranged from defiant (with Fisker stating that “We are a viable, self-funded car company”) to oblivious (in the case of the lawsuit, which Fisker PR claimed no knowledge of). Is this just a “bump in the road”, or the start of something bigger for Fisker?