Electric car startup Fisker Automotive has put its U.S. workers on furlough, or temporary unpaid leave, this week according to Reuters. The news follows reports last week in the Wall Street Journal that the Chinese auto tech companies that were bidding on an investment or acquisition of Fisker have now stalled.
There’s conflicting reports about why talks with the Chinese auto companies have grown cold. The WSJ says it’s because Fisker wants to try to get the remaining amount of the loan from the Department of Energy that was frozen, and restarting such a loan would mean Fisker’s next car would have to be built in the U.S. The Chinese companies would probably want to build the car in China where it would be lower cost. PluginCars says that the Chinese giants are less interested after looking under the hood of Fisker and realizing the company doesn’t own a lot of the technology in its vehicles.
Fisker hasn’t made one of its hybrid electric sports cars, the Karma, since the Summer of 2012. The company was plagued by problems in 2012, including the bankruptcy of its battery maker A123 Systems, hundreds of cars lost to superstorm Sandy, software glitches and recalls in the Karma cars that were made, and the loss of part of its loan from the Department of Energy for not meeting milestones with its Karma. The broker that was helping raising money for Fisker, Advanced Equities, also shut down after getting in trouble with the SEC.
Fisker founder and former CEO Henrik Fisker resigned earlier this month. The company has a loan repayment of part of the $192 million that it was able to secure from the DOE next month. Fisker raised over a billion dollars from private investors. It’s Karma car is owned by some well known customers including actor Leonardo DiCaprio, hip hop artist The Game, pop artist Justin Bieber, former Vice President Al Gore, and actor Matt Damon.