Shakeout hits small EV makers
Green manufacturers are struggling or failing to find financing
As gasoline prices rise again, you might expect demand for electric vehicles to be strong. Struggling EV companies certainly hope so.
So far, however, consumers haven't been willing to pay significantly more for a vehicle with limited range that can't easily be "refilled." Without sales to provide cash, many EV manufacturers were hoping for money from the U.S. Department of Energy's Advanced Technology Vehicles Manufacturing loan program. But political controversy after a few well-publicized bankruptcies has apparently idled the program until after the presidential election.
That leaves EV makers in a tough position. Some are moving forward, albeit slowly. Others are stalled, lacking funds to build vehicles and an uncertain demand even if they could. And some have gone under.
Here's a look at how high-profile and less prominent EV makers are faring. Their fate offers a snapshot of the green-car movement.
Palo Alto, Calif.
Elon Musk, CEO
Tesla introduced the Model X electric SUV in a flashy nightclub atmosphere at a giant warehouse in the Los Angeles area. That's the kind of high-profile image that Tesla CEO Elon Musk generates.
Tesla does have something to brag about, though: vehicles on the road. Tesla sold more than 2,000 units of its first model, the Roadster, launched in 2008 and priced at more than $100,000. Orders for its second EV, the Model S sedan, are pouring in, Tesla says. Deliveries will begin in July, the company promises.
As for the Model X, Tesla says it received a wave of orders after the SUV's introduction, even though the price hasn't been announced and deliveries aren't scheduled until 2014. Tesla's Nasdaq-listed stock has generally recovered after plummeting early this year.
Though spooked by the departure of two executives, investors may have calmed down after recalling Tesla's July 2011 agreement to sell EV powertrain technology to Toyota Motor Corp. for $100 million and an agreement to sell battery packs to Daimler AG, as well as a later agreement to develop a powertrain for Daimler.
Tesla also received approval for a $465 million loan from the DOE advanced technology program. Model S funding is to come from that loan.
If a company could run on its fans' enthusiasm, Tesla would be a sure thing. Even though it can't, the company's diverse income streams give it decent survival chances. It doesn't hurt that its cars are pretty damned nice, too.
Reuben Munger, CEO
It seemed like a bright idea in 2008 to develop a plug-in electric hybrid powertrain, put it in a mid-sized delivery van and market it to fleets.
Fleet operators, after all, are concerned about total cost of ownership. Bright Automotive even landed a $5 million investment from General Motors.
But Bright was depending on a $314 million loan from the DOE advanced technology program. After waiting more than three years for loan approval, Bright threw in the towel on Feb. 28, reportedly laying off a staff of 60 in Michigan and Indiana.
Tom LaSorda, CEO
It seems sex sells in the EV industry, but it may not attract enough funding. Fisker has orders for some 2,500 units of its $103,000 low-slung and sexy Karma plug-in hybrid luxury sports car. But the launch of its second model, the Project Nina sedan, has been on hold as Fisker searches for capital.
Founded in 2007, Fisker has attracted more than $860 million in private equity funding.
But developing a car is expensive and difficult, co-founder Henrik Fisker has admitted. Fisker won a $528.7 million loan from the Department of Energy in April 2010 and has drawn down $193 million.
But access to the remaining funds was blocked last month after Fisker missed development deadlines.
Karma deliveries finally began in December after many delays. Then Fisker had to recall some Karmas to fix a leaky hose clamp in the battery pack. Henrik Fisker told Automotive News that launching his first car has been like "running over fire while people are whipping you."
Last month, Fisker Automotive shifted Henrik Fisker to the post of executive chairman, where he will oversee brand building, styling and design. Former Chrysler CEO Tom LaSorda, who joined Fisker as vice chairman late last year, replaced Fisker as CEO.
Wheego Electric Cars
Mike McQuary, CEO
In December 2010, Wheego launched the LiFe pure EV, a two-seater closely resembling a Smart ForTwo. Starting at $33,995 before tax rebates, the LiFe can hit speeds of 65 mpg, says Wheego, and has airbags, antilock brakes, power windows, and optional air conditioning. Wheego hasn't released sales figures.
Last May, Wheego CEO Mike McQuary told Automotive News the company was living "hand to mouth" as it tried to raise money. Nonetheless, Wheego spokeswoman Susan Nicholson said Wheego aims to show a five-seat version of the LiFe at the 2013 Los Angeles Auto Show. Nicholson said funding comes from private investors. Wheego has signed 30 dealers and plans to double that by year end, she said.
OK, but with the Nissan Leaf selling for a comparable price -- $35,200 before rebates -- the LiFe faces tough big-company competition.
Think Global AS
Boris Zingarevich, owner
Oslo, Norway/Elkhart, Ind.
A poster child for EV company failure, Think filed for bankruptcy three times over the past two decades, only to find new investors and rise again. The latest bankruptcy came last June.
Since then, Russian businessman Boris Zingarevich has bought Think's assets, including independent subsidiaries in the United States and United Kingdom. He aims to market Think vehicles through a new company, Electric Mobility Solutions AS, in Norway.
But Zingarevich isn't bringing anything new to the table, and Think's battery supplier Ener1 has also filed for bankruptcy.
Murtaugh: Took Coda reins in 2011
Phil Murtaugh, CEO
Coda has gone through several executives in recent years, and some industry watchers were betting the company would go under.
But last September it raised $147 million.
In January 2011, it hired GM China veteran Phil Murtaugh as its CEO, and it has added other experienced international auto executives. It also rebooted its retail strategy, going from company-owned stores to franchised dealers, which it is signing up.
Coda missed a number of launch deadlines, but its first EV, a plain-Jane sedan called the Sedan -- based on an old Mitsubishi design -- should begin arriving at dealerships in April. Coda will do final assembly of the Sedan at a plant in Benicia, Calif., in the San Francisco area. The body and battery of the Sedan are manufactured in China by a small automaker, Hafei Motor Co. Coda is producing its batteries through a China-based joint venture with Lishen Power Battery.
Industry sources say Coda is working on its second EV, a small SUV. Coda also wants to develop battery management systems and electric drivetrains as business lines.
If creating your own momentum guarantees success, then Coda will succeed. But it has raised only about $300 million, not much for a car company. Surviving will be tough. Its partnership with another Chinese company, SUV maker Great Wall Motor Co., may be Coda's ace in the hole.
Steven Schneider and Alex Wang, co-CEOs
Santa Rosa, Calif., and Zhejiang province, China
ZAP Jonway was created in January 2011 when ZAP, an EV maker in northern California, purchased 51 percent of Chinese automaker Zhejiang Jonway Automobile Co. In previous years, ZAP had failed to deliver on promises to launch an EV in the United States. In April 2010, ZAP lost its downtown Santa Rosa headquarters to an irate investor in a lawsuit.
The purchase of Jonway signaled a shift away from the U.S. market toward China. The Chinese company is already producing gasoline-powered SUVs and vans.
The Santa Rosa company is apparently still operating. Press releases make vague references to selling its electric SUVs and vans in the United States, and the Web site appears to be taking $1,000 reservations for the $38,500 ZAP Alias three-wheeled EV. But repeated calls and e-mails to numerous people at ZAP Jonway went unanswered.
Wilbur: :Secret sauce” failed to attract loan.
Paul Wilbur, CEO
Incorporated in 2006, Aptera was always a long shot. Its three-wheeled EV was radical-looking but not very practical. A passionate staff and a lightweight composite material that CEO Paul Wilbur referred to as the "secret sauce" couldn't persuade the DOE to give Aptera a $150 million loan. Aptera called it quits on Dec. 2.