Autos

China's Wanxiang to relaunch Fisker Karma car: Sources

Fabrice Coffrini | AFP | Getty Images

Chinese auto parts producer Wanxiang Group, which bought stylish electric car pioneer Fisker Automotive from bankruptcy, is accelerating the relaunch of Fisker's Karma hybrid luxury car by using a design from the company's last year of production, people close to the companies said.

Wanxiang aims to reintroduce by next year Fisker's electric cars, which enjoyed a cult following for their streamlined design among early fans including actor Leonardo DiCaprio and pop star Justin Bieber before the company's demise in 2013.

The "new" Karma that California-based Fisker, acquired by Wanxiang earlier this year, is rushing to finish is based largely on the 2012 model, said the people, who asked not to be identified. Wanxiang's top U.S. executive said in February the Karma would be reintroduced within a year.

"It will have to be nearly identical to the 2012 model, or it would need to go through (safety) testing and certification again," a person close to Fisker's suppliers said. "I don't think they want to put a lot of engineering into it either, as well as probably use up some of the old parts that are in inventory."

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Co-founded by Danish designer Henrik Fisker in 2007, Fisker had a mission to build a beautiful, "green" car that could rival exclusive European brands like Maserati and Aston Martin.

The company was an early rival of Tesla Motors but their fortunes went in opposite directions. A series of missteps and recalls led to disappointing sales for Fisker and eventually the company's bankruptcy filing. Wanxiang acquired Fisker's assets for $149.2 million in a U.S. bankruptcy auction in February.

Old suppliers angry

In Wanxiang's effort to revive the brand, the timeline could be at risk. Some of Fisker's old suppliers, which the Chinese company has contacted, remain angry because of losses suffered due to Fisker's failure, the sources said.

"They lost money and had dedicated facilities that were severely underutilized," a second person with knowledge of the matter said. "Many scrapped their tools or took them out of their facilities."

Workers operate on the vehicle battery assembly area of Wanxiang Group's electric automobile division in Hangzhou, Zhejiang province, China.
Qilai Shen | Bloomberg | Getty Images

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Fisker does not plan to simply reintroduce the 2012 Karma, a source close to Fisker said. "Not 100 percent identical," the person said. "The new Karma will be different in many key areas. It will have noticeable upgrades." He declined to provide details.

Using the 2012 Karma design could present problems given it has older features and technologies. "You're not buying something that's considered 'state of the art' necessarily," the supplier source said. "It's a big hurdle to overcome."

A Wanxiang spokesman in China declined to comment on Thursday. People at Fisker's Costa Mesa, California, headquarters, where about 90 people work, said on Thursday they were not authorized to speak to the media.

A third source said Fisker has the necessary funding thanks to Wanxiang's backing. The source close to Fisker said the company was hiring people in the United States but declined to provide further details.

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However, several sources were skeptical Fisker can meet the timeline laid out in February by Pin Ni, the head of Wanxiang's U.S. unit. The source close to Fisker said the automaker needs to resolve issues related to suppliers and production location. He declined to elaborate but said Fisker was "not there yet."

Ni told Reuters in February that Fisker planned to restart Karma production in Finland, where Valmet Automotive previously built the cars under contract, and start selling them again in the United States and Europe. The supplier source said Finland remains the starting point for production.

Once sales gained steam, Ni said Fisker could quickly commence U.S. production.

Ni also has said Wanxiang wants Fisker to complete the development of a second model called the Atlantic, a mid-size gasoline-electric hybrid sedan meant to be a more affordable "volume model" under Fisker's previous management. A red version of the car was on display in the lobby of the U.S. headquarters outside Los Angeles on Thursday.

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The Karma, a hybrid-electric vehicle equipped with a small gasoline engine that kicks in when its on-board battery is depleted, previously had a starting price of around $100,000.

About 1,800 Karma cars were sold, far short of initial projections of 11,000.