Wanxiang Interested in Aiding Fisker After A123 Purchase
Wanxiang Group Co. said it wants to support struggling luxury plug-in hybrid manufacturer Fisker Automotive Inc. that’s the main customer of a bankrupt battery supplier China’s biggest auto-parts maker is acquiring.
“It’s in our interest if we can help Fisker, in any way we could,” Wanxiang America Corp. President Pin Ni said in a phone interview late yesterday. He declined to say whether Wanxiang would invest in Fisker. Roger Ormisher, a Fisker spokesman, declined to comment on discussions with the Chinese company.
Wanxiang’s unit this week got approval from the Committee on Foreign Investment in the U.S. to buy most of the assets of A123 Systems Inc. (AONEQ), the battery maker backed with U.S. government funds that filed for bankruptcy in October. A123’s failure cut supplies to Fisker, also a recipient of U.S. funds, as the startup was replacing flawed A123 lithium-ion packs.
“They’re a customer so it will be in our best interest to support them, as a vendor or possibly in a strategic alliance,” Ni said.
Fisker, maker of the $103,000 rechargeable Karma sedan, late last year hired Evercore Partners Inc. (EVR) to find potential investors or partners as the Anaheim, California-based carmaker looks to raise more money and resume production. That came after Fisker suspended work in a Delaware plant last year when the Energy Department halted access to portion of a federal loan because of failure to meet initial sales and production goals for Karma.
“We have had interest in Fisker from a number of different potential partners or strategic alliances spanning three continents,” Ormisher said. “Given the ongoing negotiations, we cannot add any further specifics at this time.”
Closely held Fisker was initially awarded $529 million in federal loans by the Obama administration in 2009 for U.S. development and production of plug-in hybrids. The company has said it’s raised more than $1.2 billion from private investors and delivered at least 1,500 Karmas.
Fisker has hired Huron Consulting Group Inc. (HURN) to help manage day-to-day operations during negotiations. The company said Jan. 29 Huron’s Hugh Sawyer is serving as chief administrative officer.
Tony Posawatz, Fisker’s chief executive, has said the company still seeks to produce a second model, the lower-priced Atlantic plug-in, at the Wilmington, Delaware, plant, and needs additional funds to do so.
The Karma is built under contract by Valmet Automotive Oy in Finland, and goes as far as 40 miles (64 kilometers) on electricity before a gasoline engine kicks in.
Approval from CFIUS, as it is known, was the final hurdle that Wanxiang’s U.S. unit needed to overcome to complete the A123 deal. The federal interagency group led by the Treasury Department was reviewing the sale after members of Congress expressed national-security concerns over allowing a foreign competitor to obtain the technology developed with government backing.
Wanxiang’s U.S. unit is based in Elgin, Illinois.
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