Fisker electric Karma was pushed to market before it was ready

Fisker Karmas

Updated. Electric car startup Fisker Automotive pushed its long-delayed inaugural electric car to market before it was market-ready in order to try to meet government milestones for a loan, according to a former Fisker retailer employee that left the company. (Update 3/15/12: The Chronicle discloses more on the exec and I’ve corrected this article to reflect that the employee worked at a Fisker retailer, not as a full time Fisker employee).

Update 3/15/12: Fisker sent over a second statement that says these “allegations are absolutely untrue,” and the exec “was not privy to any business information from Fisker concerning the development of the Karma sedan and/or Fisker’s financing.”

Over the past few months, as hundreds of Fisker’s extended-range electric Karmas have been shipped to customers, some of the cars have had a variety of technical issues, including being recalled for a battery problem and requiring software upgrades, and Consumer Reports even reported last week that a Karma it had bought to test out died upon arrival.

Consumer Reports wrote in a blog post:

We buy about 80 cars a year and this is the first time in memory that we have had a car that is undriveable before it has finished our check-in process.

The former Fisker retailer employee said that it wasn’t uncommon for the first Karma cars to have technical issues, and said that was one reason for leaving the Fisker retailer — the employee now works at with electric car company Coda. The former retailer employee says that Fisker launched the car before it was market-ready in order to try to meet milestones from the Department of Energy for its loan. Fisker was awarded a $529 million loan award from the DOE in late 2009, but because the Karma was so delayed to market, Fisker had been unable to draw down on the rest of the DOE loan since May 2011.

I’ve contacted Fisker for a response and will update this when I hear back. Update 3/12/12: A Fisker spokesperson says to me: “Quality and customer satisfaction are the top priority for Fisker Automotive. With any new technology there will be unanticipated bugs and we have demonstrated the ability to quickly resolve them on a case-by-case basis. In addition, Fisker’s 24 hour VIP call centers and comprehensive vehicle warranty are also designed to give our customers complete peace of mind.”

It should be noted that given electric car technology is new, it’s not so uncommon for the first line of electric cars to face some of these types of issues — the first versions of Tesla’s Roadster faced a few recalls.

As a result of the DOE withholding the rest of the Fisker’s loan, Fisker said it has suspended production of its second car the Nina, which it was planning to build in Delaware. Fisker also says it is now looking for alternative funding to build Nina and to get its Karma cars to market.

A couple weeks ago Fisker brought in a new CEO, former Chrysler Chief Executive, Tom Lasorda, and said on a call with the media that Fisker is planning to be profitable in 2013 off of just the Karma line. Fisker said as of the end of February, it had produced 2,000 cars and shipped 840 of them to dealers and distributors. The extended electric car the Karma costs $100,000.