Automotive designer/entrepreneur Henrik Fisker was among the first to target the emerging market for electric cars, only to watch his initial effort come crashing down after the Great Recession drove the auto industry into the ground.
Now, Fisker is ready to try again by taking direct aim at his original rival, Tesla. His latest start-up has announced plans to build and market an "affordable" battery-electric SUV to challenge the new Tesla Model Y. But the former designer faces a number of obstacles, including the resurrection of his original venture, Fisker Automotive, now renamed Karma.
Fisker Inc. last week released a teaser image of its new electric SUV and, in an exclusive interview, the company founder and CEO said the search is underway for a factory that can get it into production by the second half of 2021. Eight states are in the running, according to Fisker, and he hopes to pick a site within eight to 10 weeks.
The 55-year-old automotive veteran first made his name as a designer, his most renowned effort being the Aston Martin DB9. In 2005, he set out to form his own company, Fisker Coachbuild, with the novel idea of taking existing luxury cars, peeling off their sheet metal skins and replacing them with unique new bodies. Only a handful were produced by 2007, when Fisker was asked to provide initial design work on the Tesla Model S. Later that year, he decided to launch his own battery-car company.
Unlike Tesla, Fisker Automotive focused on a highly stylized plug-in hybrid, rather than a pure battery-electric vehicle. The company founder was skeptical about the range and cost of the battery technology available then. After numerous delays, the Fisker Karma went on sale in October 2011, but a series of setbacks crippled the project. Fisker himself resigned in March 2013, and the company went bankrupt shortly afterward. Its assets were purchased by Chinese auto parts maker Wanxiang in September 2015 for $149.2 million.
Three years ago, the Danish-born Fisker resurfaced. This time, he was touting another highly exotic design dubbed the EMotion. Intended to more directly target the Tesla Model S, it also shifted from plug-in to pure battery power. But that project has been put on the back burner, Fisker told CNBC last week.
"We decided to push back to focus on this project," a more mainstream SUV "that will go for less money but which should generate more revenues," he said.
The teaser image doesn't show much beyond the nose of the vehicle, which will target Tesla's new Model Y. The two vehicles share at least some key features. Neither uses a conventional grille, since there's less need for air under the hood when you're not using an internal combustion engine. Both rely on skateboard-like "architectures," with their motors and batteries mounted under the floorboards.
That approach lowers the center of gravity, enhancing ride dynamics. It also means there's less needed under the hood, so some space traditionally devoted to the engine compartment can be recaptured for passengers and cargo. Expect a "vastly spacious interior," the company said in a statement.
Like the Model Y, Fisker's entry will be powered by lithium-ion batteries, but rather than offering buyers a choice of different-sized packs, there will be only one. With 80 kilowatt-hours of storage, Fisker claims, it will yield close to 300 miles of range.
Unlike the Model Y, which will be offered in four versions — long-range, high-performance, all-wheel-drive and base models — Fisker is aiming to combine those features into a single package. Not only does that match the longest-range version of the Tesla SUV, but the Fisker will feature twin motors, one driving each axle. Performance numbers haven't been released but Fisker hinted of figures close to those of the quickest Model Y, which will hit 60 mph in just 3.5 seconds.
With a project starting price of "below $40,000," Fisker's offering would do all that for about the base price of the Tesla. And "we will have a big advantage" over the California rival, the CEO said, "if the tax credit stays."
Currently, battery-electric vehicles qualify for up to $7,500 in tax credits, but they begin to phase out once a manufacturer hits a 200,000 sales threshold. Tesla's incentives dropped by half on Jan. 1 and will end entirely on Dec. 31. General Motors and Nissan will soon see their tax credits start to phase out.
Fisker said he hopes to have a "fully driveable" prototype available for analysts, investors and journalists to test by the end of this year.
By then, if all goes according to plan, the company will already be tooling up its new factory. The CEO was cautious when pressed for details. He suggested it was focusing on the Midwest, where there are empty auto and parts plants to choose from as well as a well-entrenched infrastructure of automotive suppliers. But there are other options, he noted, adding that state and local incentives will be factored into the final choice.
As a private start-up, Fisker Inc. doesn't release much in the way of financial details. But the company scored a high-profile investor when Capture Venture Capital, a wholly owned subsidiary of Caterpillar, announced a strategic investment last October. The Illinois-based investor is backing Fisker's battery-car program as well as its push to commercialize so-called solid-state battery technology.
Fisker's new SUV will use conventional lithium-ion but could be switched later to the new batteries, a form of lithium-ion technology that replaces the gel-like chemistry inside each cell with a ceramic structure. Some experts believe solid-state batteries will become the norm by the end of the next decade, in part because they are expected to be lighter, more powerful, cheaper, faster to charge — and won't be flammable like today's lithium batteries.
The company has set up its own battery lab and Fisker is confident enough about the technology that he believes it will be available when the bigger and more expensive EMotion sedan is now scheduled for launch a year after the mainstream-priced SUV.
In light of Fisker Automotive's spectacular meltdown, the former designer's new venture has raised some skepticism. Stephanie Brinley, principal auto analyst with IHS Markit, is one of them.
"What's happening to the broader EV market is that traditional (automotive) players are coming on strong at the same time a lot of new players want to enter the space," she said. "That means it will get very crowded very quickly. The new entrants, Tesla in particular, have dominated so far, but that could shift."
Whether Fisker can remove the shadow of Tesla and establish its own identity is another concern Brinley raised.
Fisker may also be facing his own karmic retribution, here in the form of the battery-car company he founded and sold in 2015, now renamed Karma Automotive. The Chinese-owned company, which is based in California, recently relaunched production of the original sports sedan he designed: the Fisker Karma. A complete makeover, along with a new battery-electric vehicle and a concept vehicle, will make their debut at the Shanghai Motor Show next month.
The good news for Fisker's latest venture is that Karma remains focused on the higher end of the battery-car spectrum.
Wherever the new Fisker factory goes, it will have to offer the capacity to produce at least 200,000 vehicles annually, something the CEO calls "a strong target." Considering only one company, Tesla, comes close to selling that many battery-cars annually, it's also a risky one. But while there are plenty of potential obstacles that could short-circuit Henrik Fisker's latest venture, Brinley said she isn't about to write the new company off.