Blog Post

Valley’s Green Car Feud: Tesla Sues Fisker

Stay on Top of Enterprise Technology Trends

Get updates impacting your industry from our GigaOm Research Community
Join the Community!

Tesla and Fisker Automotive, the two electric-car startups backed by Silicon Valley’s most well known cleantech VCs, are involved in a now very public feud. On Monday Tesla filed suit in Superior Court in California alleging that Fisker stole Tesla’s design ideas and trade secrets.

The New York Times digs up the details and says Tesla hired Henrik Fisker, founder of Fisker Automotive, last year to do some design work for the body of Tesla’s sedan, code-named White Star. Tesla says Fisker and Fisker’s COO Bernhard Koehler entered into a $875,000 design contract with Tesla then walked away with trade secrets and launched their own competing car. (Here’s our previous interviews with Fisker, and Tesla’s Chairman and CEO.)

Whoa. Fights in the Valley’s very small world among competitors aren’t uncommon, but this one’s a doozy. Particularly because each startup is backed by competing venture firms. Tesla is backed by Elon Musk, VantagePoint Venture Partners, Draper Fisher Jurvetson and individual investors, including Jeff Skoll and Google’s Larry Page and Sergey Brin. Fisker, on the other hand, is backed by Kleiner Perkins Caufield & Byers and has KP’s Ray Lane on its board.

Tesla’s VP of sales, marketing & service, Darryl Siry tells us that Tesla worked with Henrik Fisker between the end of 2006 and the end of 2007. During that time Siry says Fisker produced designs for White Star that weren’t quality, and in hindsight Siry says it’s not a surprise that Fisker ended up producing a competing car. Tesla filed the suit for breach of contract and is also asking for unspecified damages beyond that.

There are some similarities in the companies vehicles. Fisker’s Karma is a range-extended electric car, and cost $80,000. Tesla will also offer a range-extended version of its next-gen car code-named White Star for around $50,000. In an interview back in February we actually asked Henrik Fisker if “After watching Tesla get its Roadster to market this year and now start work on the White Star, is there anything you have learned from Tesla’s mistakes or successes?” Fisker said:

We do not compare ourselves to other startup companies. We believe we are a different type of startup, as all of our people come from the automotive industry and have extensive experience with the automotive industry. We are therefore taking a different approach, knowing how complicated it is to bring a vehicle to the market.

The two startups also have the added layer of trying to keep their companies’ images as “green,” altruistic climate-change fighters, and a lawsuit like this shines light on what’s actually at stake: a whole lot of money. On that note, The New York Times has the money line:

“I think it’s ironic that Fisker chose to name his car the Karma, when what he’s done is very bad karma,” Adam C. Belsky, a lawyer at Gross, Belsky & Alonso who represents Tesla.

We’re contacting the companies and will add more when we learn more.

17 Responses to “Valley’s Green Car Feud: Tesla Sues Fisker”

  1. I couldn’t disagree more. There is absolutely something unique about sticking an electric motor in a car when that motor is powerful enough to propel said car 0-60 in under 5 seconds and sustain trips of more than 200 miles. Living in the Bay Area I see them driving the Teslas around all the time (pics are here) and they’re beautiful cars that are actually out on the roads.

    Do you have any idea the barriers to entry from a safety standpoint of any new car getting on the road? The fact that they’ve made it this far is incredible – I wish them the best.

    (p.s. the circle jerk/view comment was still hilarious.)

  2. The thing that sent me over the edge was the pomposity and hypocrisy of the tesla exec who posted a long blog entry about how they were not the same as other vaporware startups and why. Great if he gets his rocks off on “solving” technical problems related to making car sub systems work, then call your company a R & D auto engineering consulting firm.

    Otherwise, shut up and ship something. I’d be happiest if I never heard from Tesla until they built and delivered 10,000 units and they were reporting on customer satisfaction and their improvement being implemented from actual customer feedback.

    I want to buy innovative products, solar panels, Fuel Cell vehicles, home H2 production systems, kinetic device charging systems, advanced vertical axis home wind systems – I am burnt out reading about all this shit that is 3-5 years out that clogs the tubes of the social news websites. People are yearning for someone/some company who is here to chew gum and kick ass but instead all we ever get is a mashup between a circle jerk and an episode of The View.

  3. Amen Ann. There is nothing unique in sticking an electric motor in a car. The unique (and still elusive) thing seems to be actually making and selling them. Hell, even if Fisker sold exactly what they designed for Tesla, it would still help Tesla because it would show that an Ecar company finally can do something besides talk.

  4. Maybe Tesla should quit whining and talking, shucking and jiving, and start rolling something off the production line. If not, fold already so we don’t have to be subjected to the constant stream of stories about how someday they are going to make the best car in the world.

  5. Without knowing the details, I would tend to side with Fisker on this one. Fisker, after all, is building a PHEV, whereas Tesla was supposed to be building electric vehicles. The fact that Tesla is belatedly looking into the notion of extended-range electric means that their basic notion was flawed, at least for reasonably-priced vehicles.