Fisker stops production, announces lay offs as it tries to renegotiate loan

Article by Anita Panait, on February 7, 2012

Fisker Automotive temporarily stopped work on its Nina family sedan at its Wilmington, Del. site until such a time that the company and the US federal government would agree on the new terms of a $529 million loan doled out by the Department of Energy. The renegotiations came between Fisker and DOE after the former failed to meet certain targets for its pioneer model, the Karma.

 Under the current terms, DOE requires Fisker to meet certain deadlines, or milestones for the production of the Karma. Since the targets were not met, DOE required revision of the terms of the loan to incorporate new deadlines for the Nina. Fisker, however, downplayed the renegotiations as normal. "DOE loan modification negotiations are fairly standard procedure," Fisker spokesman Roger Ormisher said, adding that what is happening “is a relatively ordinary series of events."

The production stoppage has forced Fisker to end services of 26 employees at its Delaware site and a number of contract engineers at its Anaheim, Calif., headquarters. The staff reductions at the company’s headquarters were intended to culminate in between development of the Karma and Nina.

Ormisher revealed that the Delaware site is being set up for the Nina, as the company finished installing stamping presses and robots. The company still has to install more equipment at the site. He also disclosed that Fisker has signed off on the design work on the Nina and has chosen a range-extending BMW four-cylinder to power the vehicle.

"Project Nina is already well advanced," Fisker said in a statement, adding that much of the engineering, design and development is nearly complete and so it expects to ramp up operations again. The Nina family car is expected to be smaller than its Karma sibling, having a size comparable to a Mercedes C-class and E-class. Fisker is producing its Karma vehicle at Valmet Automotive in Finland.

Topics: fisker, production

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