Did You Know That GM Owns Part of Fisker?
If you’re a regular reader of TTAC, one of the Best & the Brightest, you probably know that the Fisker Karma’s range extender is a 2.0 liter turbo Ecotec engine supplied by General Motors. What you probably don’t know is that GM’s relationship with Fisker goes beyond that of a vendor and a customer. That’s because GM owns part of Fisker. Okay, technically speaking General Motors owns a minority interest in a company that was once Fisker’s majority owner and that still holds an equity stake in the startup EV maker. Regardless of the details, that still counts as GM having an interest in Fisker’s success or failure.
Ever since Henrik Fisker announced his bold plan to start a new car company that made sporty and sexy green cars, a company called Quantum Technologies has been in the picture. Quantum is involved in a lot of alternative energy technology. They supply components for Ford’s PHEVs as well as tanks and tech for CNG vehicles for other manufacturers. Quantum also has significant contracts with General Motors and may be a supplier for the Volt. In addition they’re a military supplier working on stealthy offroad vehicles powered by things like hydrogen fuel cells. Other military projects use what Quantum brands as the Q-Drive, a series hybrid system where a combustion engine drives a generator that provides electricity for extended range when the batteries are depleted. The Karma uses a drivetrain based on the Q-Drive system.
Fisker also has used Quantum’s money to get off the ground. Initially Quantum owned 62% of Fisker. After investments by Kleiner Perkins Caufield & Byers and other private equity investors, that stake has been diluted to only 1% but don’t cry for Quantum, Argentina or anyone else. The company is paid a royalty fee for Fisker’s use of the Q-Drive of between $3,200 and $4,100 for each Fisker Karma that is sold. Quantum also makes money selling Q-Drive components to Fisker Automotive. It’s not clear if GM sells engines directly to Fisker or if Quantum is a middleman so Quantum may also make money brokering those motors.
General Motors’ relationship with Quantum goes back at least a decade. Quantum, as mentioned, has done research on fuel cells and done other contract work for the giant automaker. In 2002, GM announced that it was taking a 20% interest in Quantum. At the time GM’s main objective in that hookup was in Quantum’s hydrogen storage systems. In a 2006 filing by Quantum, GM’s stake was said to be 8.2%. GM’s interest in Quantum seems to have survived GM’s 2009 bankruptcy and restructuring. In a 2010 interview with the Wall Street Journal, Jon Lauckner, now GM’s Chief Technology Officer and at the time head of a new GM venture that was investing $100 million in emerging technologies, alluded to GM’s equity stake in Quantum and Quantum’s relationship with Fisker. That equity appears to now be around 7% of Quantum’s stock.
Seven percent of one percent isn’t much. It works out to GM owning the equivalent of less than one tenth of one percent of Fisker. Still, GM’s interest isn’t chicken scratch. Fisker is going to build about 10,000 Karmas this year. The royalties due Quantum on those cars is more than $35 million and remember, that royalty is in addition to vendor payments from Fisker. Some have suggested that GM made a mistake by first offering the Volt’s drivetrain in a Chevy and not making it available as an upmarket Cadillac. It appears that by hedging their technology bets via Quantum, through Fisker GM already has an interest in an upmarket PHEV.
Ronnie Schreiber edits Cars In Depth, a realistic perspective on cars & car culture and the original 3D car site. If you found this post worthwhile, you can dig deeper at Cars In Depth. If the 3D thing freaks you out, don’t worry, all the photo and video players in use at the site have mono options. Thanks for reading– RJS
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The q-drive is based on military research so we all own a part of it. When it comes to better ways of killing we're all socialists.
I'm betting GM will be filing their share under '... or failure.'