A few years ago, a race began. It was between two relative unknowns, with two very different strategies, and had two very different outcomes. Fisker Automotive and Tesla Motors unwittingly locked horns in 2008, both intent on delivering the world's greatest electric sports sedan. For Fisker, the solution was a tried and tested one: offer a car with limited electric range, perfect for the daily commute and short journeys, and include a gas engine to boost power and charge the battery for maximum performance and range. Tesla, which had enjoyed limited success with its all-electric roadster, took the cleaner, but arguably more complex, route -- an entirely electric sedan with sufficient battery capacity to render a range-extending gas engine unnecessary. Both offered stunning designs, and each had lofty goals. But fast-forward to today and it's two very different tales for these companies.
Fisker Automotive has finally been sold, to Wanxiang, a Chinese automotive-parts company. It suspended production of its Karma sedan in November 2012 while in a quagmire of financial difficulties, the last straw in a series of issues that had plagued the company. Originally intended to launch in 2009, the Karma didn't reach showrooms until 2011, with just 2,450 models built until production ceased. The Karma itself didn't help matters. Though beautiful and fast, it received a lukewarm response from critics and was beset by reliability problems, requiring a recall to fix a coolant hose issue that could lead to an electrical short or -- in the worst case -- a fire in the engine. A house fire in Texas was blamed on a Karma combusting, and another model ignited while parked in a California lot. When Consumer Reports test-drove the Karma, a model with just 200 miles on the clock, it broke down while undergoing a speedometer check and refused to be revived. CR stated that it was the first time a car has been rendered un-drivable during the initial check-in process.
Fisker slowly fell apart, plagued by mismanagement, a lack of funding and the inability to resume production of a car that, by that point, nobody wanted to buy. Henry Fisker, who founded the company, resigned in March 2013, citing disagreements with management and business strategy, and the company officially filed for Chapter 11 bankruptcy in November of that year. It listed debt of as much as $1 billion. Fisker was put on sale, a hollow shell of a company, with the possibility that it would be used for its parts and patents and no promise of production ever resuming. The company was finally put up for auction Feb. 12, and after 19 rounds of bidding between Wanxiang and Hybrid Tech Holdings, the former emerged the winner with its $149.2 million bid. Incidentally, its bid was six times the figure that Fisker sought to recover when it filed for bankruptcy.
The sale is scheduled to be approved by Judge Kevin Gross in Delaware. If confirmed, Wanxiang could conceivably revive the brand in China, as a poster child to help combat the pollution that blankets much of the country's major cities. It could also, potentially, restart production of U.S. models. However, much of this is pure speculation. One thing is certain: The Fisker that started life in 2007 in Anaheim, Calif., with the dream of building an alternate-energy vehicle is long dead. Whatever is resurrected from the ruins will resemble it in appearance alone.
Tesla, on the other hand, couldn't be stronger. With stocks hovering around the $200 mark, sales of its Model S breaking 25,000 worldwide since launching in 2012, production of its Model X crossover to begin at the end of this year and a lower-priced model scheduled to begin sale in 2016, the company is moving from strength to strength. A nationwide recharging network, up to 265 miles of range in the highest-powered Model S andConsumer Reports' first ever 99 out of 100 score have all helped to boost the Model S's image, and the company is expanding and planning for the future in a way many didn't think possible when it announced the Model S sedan in 2008.
Yet that expansion is coming at a price. Tesla favors a direct-to-consumer sales model, with dealerships letting potential buyers customize and purchase their model, which Tesla will then deliver directly to them. This has, somewhat understandably, caused worry among the dealership networks that branch across every state, with fears that other manufacturers could emulate Tesla's business model and render their dealerships obsolete.
The latest challenge to Tesla's business model comes from Ohio, where state Sen. Tom Patton (R) is pushing SB260 in the Ohio Senate. The bill would stop any company from selling vehicles if it "is a manufacturer, or a parent company, subsidiary, or affiliated entity of a manufacturer, applying for a license to sell or lease new or used motor vehicles at retail." Should the law pass without any measures protecting the Tesla stores already open in the state, it would make Tesla's operations illegal there.
What further muddies things is Patton's rationale for proposing the measure. Between 2002 and 2013, according to Media Trackers, Patton received at least "$42,825 from state and national auto dealership owners, employees, and political action committees." Venture onto Patton's Facebook page and it's slowly filling with angry posts from those decrying his moves to shut down Tesla's business model as "anti-American," "crony capitalism" and "just wrong."
As for what response Tesla might bring to the table, CEO Elon Musk stated last year that action may be required at the federal level. He told Automotive News, "It's really difficult for a new company with a new technology to be franchised. It's not possible to effectively sell a new technology like electric vehicles, for a dealer to do that, without undermining the story behind gasoline cars."
If more states consider legislation restricting Tesla's selling model, Musk said, "rather than fight 20 different state battles, I'd rather fight one federal battle."
For the moment, though, everything's coming up Tesla.
Read more of Rhuaridh Marr's automotive coverage daily at metroweekly.com/auto. Follow him at @rhuaridh.