Fisker Automotive, maker of the sleekly styled Fisker Karma, an extended-range $100,000 luxury electric vehicle, continues to make news.
Fisker just added another $100 million in new venture funding, according to reports in the Wall Street Journal. That still-open funding round takes the firm's VC totals north of $1.2 billion, a figure that puts it into competition with the likes of Solyndra and a few others as most highly venture-funded company in the history of venture capital. That is not always an indicator of success. The firm has also drawn down $193 million of a DOE loan guarantee.
Previous investors in the firm have included Kleiner Perkins, NEA, Palo Alto Investors, A123 Systems, Ace Investments, the Qatar Investment Authority, as well as the VC banking services of Advanced Equities through solicitations to wealthy individuals as illustrated here:
Advanced Equities is relied upon by Kleiner, NEA, and other venture firms to fill out large capital-heavy rounds for startups like Fisker, Serious Materials, Bloom Energy, and SolFocus. Recently, the founders of Advanced Equities were fined by the SEC and lost their jobs for hugely overstating the sales backlog of fuel cell vendor Bloom Energy.
The new investment comes amidst a set of recent struggles for the startup, including recalls, stalled production and:
- The company stopped work at its Delaware Project Nina plant and laid off 66 workers, as it could not further access its DOE loan guarantee.
- Fisker issued a recall for the Karma for a battery problem. About 1,500 Karma models have been sold.
- Greentech Media captured some photos of a recent Fisker fire here. This incident was not related to any battery problem, according to the firm and a third party.
- Fisker is on its third CEO.
- Fisker is also tied to the struggling and recently rescued battery maker A123.
The Illinois Student Assistance Commission, an entity which administers a $1.1 billion prepaid college savings plan accessed by tens of thousands of families in Illinois, made a $10 million direct investment in the luxury hybrid company, according to Crain's Chicago Business. According to the article, the Commission "expects to lose more than half of its $10 million investment in luxury hybrid-car startup Fisker Automotive."
The original investment, once valued at $14 million, is anticipated to lose about two-thirds of that value with the recent Round E funding round. The commission "changed its investment policy in June to forbid future direct investments or co-investments in private companies, believing they are not appropriate for a public fund like College Illinois."
Consumer Reports just published its test report on a $107,850 Fisker Karma and found it "plagued with flaws." The nonprofit, independent organization wrote, "Compared with other luxury sedans, the Karma has tight confines and limited visibility, and a badly-designed touch-screen system makes the dash controls an ergonomic disaster."
The review continued:
"Although we found its ride, handling and braking performance sound and it has first-class interior materials, the Karma's problems outweighed the good," according to Jake Fisher, Director, Consumer Reports Auto Test Center. "Despite the car's huge dimensions, it's very cramped inside. The overcomplicated controls are frustrating and it's hard to see out. When it's running, the gasoline engine has an unrefined roar. And the Karma's heavy weight affects agility and performance, as the Karma lacks the oomph you expect."
The magazine favored the Porsche Panamera rather than the Karma in that class of vehicle. The reviewer did find the Karma's styling "stunning" but noted that the car "had a rough start in CR's testing when it suddenly became disabled on the organization's test track. Fisker replaced the battery pack in CR's test car, and later offered replacements for all 2012 Karmas. But CR's engineers have continued to encounter disconcerting intermittent glitches related to the gauges, warning lights, power windows and radio."
Fisker responded quickly to the review in CR. Here are excerpts from the company's statement.
The Karma impressed CR’s evaluators with its outstanding ride, handling and braking, which can be attributed to the car’s low, wide stance, race-inspired suspension and massive Brembo brakes. As the Karma is a concept car come to life, packaging and visibility will of course not be that of a minivan.
The Karma’s innovative powertrain technology lowers the center of gravity to give it a slalom time close to that of high performance sedans from the best European manufacturers. And the 66 MPGe recorded during testing -- the highest of nearly any production car -- is a great endorsement for Fisker as pioneers of this new luxury segment.
Plans are in place to improve sound quality, which is a new challenge for all silent-running EVs, while software improvements are being made to touch-screen controls to improve responsiveness and functionality
Like competitor Tesla Motors, Fisker's long-range future depends on its ability to pivot from its luxury sports car market entry-point to mass production of its Sedan.