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If it weren't for billionaire Lu Guanqiu, founder of Chinese auto parts giant Wanxiang Group, the Fisker Automotive bankruptcy bailout deal might have closed earlier this month. Hong Kong tycoon Richard Li, along with Li's affiliate company Hybrid Tech Holdings, assumed their offer was going to be accepted. Instead, the US bankruptcy court judge called for an open auction bid for Fisker's assets on February 12. Lu made a few convincing points to the judge. There's another interesting part of the story that Lu didn't share it with the judge. If the Fisker deal doesn't work out, Lu and Wanxiang might increase their working relationship with Tesla Motors.

Lu told US bankruptcy judge Kevin Gross that Wanxiang, which now owns Fisker's supplier of lithium batteries, A123 Systems, is better placed than Hybrid Tech Holdings to restart and expand production at Fisker. Better yet, Wanxiang could move production from Finland to the US. That was convincing enough for Gross to schedule the auction.

Lu's move toward taking over ownership and restoring Fisker seems to be driven by two motivations: converting his company from a parts maker to an automaker; and to grow the yet-to-be profitable "new energy " business such as lithium battery and electric vehicle makers. For Lu, it's not so much about believing in Fisker – it's more about playing a leading role in electric vehicles – and that could come through deepening its connection to Tesla Motors. "Of course we want to pocket Fisker. But we will bid rationally," he said to Reuters. "Whatever the result, nothing can stop us from making electric cars."

Check out more about Lu in this Reuters piece, including how he and six other farmers pooled together $500 in 1969 to start what would become Wanxiang.


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  • 26 Comments
      m_2012
      • 2 Months Ago
      Stay away from Tesla. They don't need or want your help. Once you wanted anything to do with Fisker, you lost all credibility. Take C8910 and go away.
      SeadogMillionaire
      • 2 Months Ago
      Fiskers are beautiful and should be all over the road, not bankrupt !!! I hope "Wanxiang" gets to purchase Fisker and move the plant to the United States. While my preference in an electric car remains the Cadillac ELR, I would definitely consider a Fisker ... if they are a viable operating company.
        dlubeck_mbz
        • 2 Months Ago
        @SeadogMillionaire
        I agree completely. And I continue to believe Fisker needs a complete overhaul of their management and current staff, who have been more concerned with building up their own wealth than sustaining a profitable business. I think this has been planned since years ago--use up all the taxpayer money to build a car in Finland, outrageous travel and other expense for their executives and employees, Henrik leaving (and will come back again once the company is bought for cheap by Li), bankrupting the company, then Li trying to buy the company back without any competition. Henrik is just waiting on the sidelines until he can make his presence with Richard Li. Hopefully, we won't see that, and instead Wanxiang will win the bid and hire new, competent management and engineers. The car itself deserves a great management team.
          raktmn
          • 2 Months Ago
          @dlubeck_mbz
          dlubeck -- you keep bringing the issue of management change up in every blog entry about Fisker. But pages 53-54 of Fisker's bankruptcy filing show that 23 out of 37 of their top management (officers and members of the board) have ALREADY left Fisker. With others fully expected to no longer work there or be members of the board in the New Fisker company. Which of the remaining officers and board members do you have such strong objection to? I'm not attacking, I'm just trying to make sense of your comments in light of the facts that probably less than 20% of the original officers and board members would probably be employed by the New Fisker. (probably much less then 20% after a one year transition period, would be my guess). I agree it needs new management. That is what them being bought by some other company that will bring in their own people is all about. ABG posted this information weeks ago. It is in the SladeShare imbedded in this blog: http://green.autoblog.com/2014/01/02/wanxiang-last-minute-fisker-bid-restart-karma-production/
        Actionable Mango
        • 2 Months Ago
        @SeadogMillionaire
        I don't see why Wanxiang would move Karma manufacturing to the USA. There are obvious benefits to keeping it in Finland (existing factory, tooling, and experienced workers). There are obvious benefits to moving it to China (reduced costs, it's domestic to them). I have no idea why they would move it to the USA. It can't be incentives; I doubt any US government entity would put more money into Fisker. I think US manufacturing for Fisker is a dream being sold to American bankruptcy court officials.
          raktmn
          • 2 Months Ago
          @Actionable Mango
          Some of the reasons why they would move production to the US are the same reasons that BMW, Toyota, VW, Honda, Hyundai, Audi, Mercedes, etc all have moved manufacturing to the US. Those reasons have already been well established, so I won't bother going into detail. But on top of the same reasons that all these other companies build in the US, Wanxiang has a number of additional reasons. 1) Wanxiang America now owns A123 Systems LLC, and A123 builds all their automotive format battery cells right here in the United States. Wanxiang's proposed factory to build the Fisker gliders will be just a couple of hundred miles away from where the batteries will be manufactured, instead of half way around the world. 2) Wanxiang has already announced their partnership with Bob Lutz and VL Automotive, and their intent to use existing factory floor owned by VL right here in the US, to build common gliders to be used by both companies using experienced US workers. Yes, new tooling would need to be acquired. But one of the complaints about the old Karma's was that the fit and finish was not worthy of such and expensive car. So the old tooling wasn't doing the job anyways, and would need to be addressed regardless of where it is built. 3) The terms of the old DoE loan are still in force even after the DoE sold the loans. It is up to the judge to determine if any terms of any contracts survive through the bankruptcy. Wanxiang has filed with the court their willingness to continue to be bound to a number of contractual agreements that they are willing to abide by after the bankruptcy. These include such things as limited warranty coverage for existing owners, agreeing to allow some litigation to continue after the bankruptcy, etc. Wanxiang may agree to production in the US as a binding extension of the DoE loan terms, even after the debt itself is discharged. 4) The papers that Wanxiang has filed regarding their intentions to build here in the US were sworn documents. That means that if they are lying about their intentions as you imply, they would be subject to both civil and criminal prosecution. Do you have any evidence that Wanxiang America has filed false sworn statements under oath (a felony) or are you just slandering them out of knee-jerk response?
        Spec
        • 2 Months Ago
        @SeadogMillionaire
        They are beautiful. But I would not want one unless they switch to a different drivetrain.
          Letstakeawalk
          • 2 Months Ago
          @Spec
          I would be extremely thrilled to have a luxury sedan that allowed me to commute every day without needing to buy gas, but that also allowed me to take a long road trip without having to stop for lengthy charges. D'ffrent strokes for d'ffrent folks.
          raktmn
          • 2 Months Ago
          @Spec
          I like their original plans for the Atlantic drivetrain. It uses a BMW engine.
      Marcopolo
      • 2 Months Ago
      It took a long time for ABG to catch up with my post regarding the history of Wanxiang and the remarkable man who started the company. Much of the drive to buy Fisker and expand the companies automotive component manufacturing capacity in the US, comes from Guanqiu Lu's son Weiding Lu, CEO of Wanxiang America Inc. Weiding's story is also a fascinating transformation, from spoiled, irresponsible playboy, to thoughtful , responsible corporate executive and industrialist. Weiding's story encapsulates some of the facing the children of the PRC privileged elite, and newly rich. On the other hand, the other potential suitor for Fisker, Richard Li, is also a remarkable individual, with an equally interesting and troubled biography. (These families will one day be as famous as the Fords, Hilton's, Murdoch's etc. )
      Edge
      • 2 Months Ago
      Just read up on Wanxiang, and very impressive company. I like their origin story, Lu Guanqiu was one of a group of farmers that started the company in 1969 with $500, and local officials laughed at them for doing this. Now it's a huge company, with factories all around the world. They have a long history of buying companies that have either gone bankrupt or close to it, and turning them around. I admire Lu Guanqiu business sense. He is frugal and hardworking, even at age 68.
      EVnerdGene
      • 2 Months Ago
      "Open auction" ? I don't understand why the bankruptcy judge is listening to BS about where it will be manufactured in the future, who they might be partners with in the future, whether or not it will even be produced again in the future - who cares? The objective of a bankruptcy auction is to: 1. Sell it to the buyer willing to pay the most for the assets and liabilities and/or 2. Agreeing to pay the highest pennies per dollar owed to the past creditors (see #1)
        raktmn
        • 2 Months Ago
        @EVnerdGene
        The price of the bid is not the only factor in a bankruptcy decision. Other factors, like how viable the company will be coming out of bankruptcy, so it doesn't just fall right back into bankruptcy again, weight heavily upon a judge's decision. The judge isn't just a bean counter, and bankruptcies aren't just about dividing up whatever assets are left between creditors. Our bankruptcy laws all center around the concept that rebuilding companies whenever possible out of bankruptcies, is a positive social and economic benefit to everyone.
        EVnerdGene
        • 2 Months Ago
        @EVnerdGene
        And you think a politically-appointed lawyer/judge/bureaucrat, with no business experience, can do a good job in social engineering and making the best business decisions? (like in giving the loan to Frisker in the first place?) You also believe in santa clause, easter bunny, fairy god mother, and hope and change? Government caused collapse of the mortgage and housing industry? Then bailing out their contributors on wall street and in the banking industry with printed money and debt spending? 2572-page unaffordable heathcare bill, and spending a billion on a sick website to a Canadian company? (uh, why was that company chosen?) Neo-brownshirts are so gullible. http://www.youtube.com/watch?v=6ixNPplo-SU
      m_2012
      • 2 Months Ago
      He needed a tax write off. Nothing more. No one cares that much anymore about 20MPG, six figure, slow hybrids. They may build a few in China but its never going to be a real car.
        raktmn
        • 2 Months Ago
        @m_2012
        As we've seen from the Volt statistics on voltstats.net -- the MPG rating in charge-sustaining mode (MPGcs) has very little correlation between how much gas PHEV's use in a year. If you don't believe me, goto voltstats.net, and sort by MPGcs and take a look at the MPG for cars getting 20 MPGcs. Most of them have traveled well over 100 miles on each gallon of gas they've burned, with "Sarah's Volt" having traveled 1,284 for every gallon of gas she's burned. If at the end of the year, a Fisker or a Volt owner that gets 20 MPG in charge sustaining mode, has burned 10 gallons of gas after driving a very typical 13,000 miles, who cares what the MPG is in charge sustaining mode? I don't think you understand this whole PHEV thing, and how it works.
          JakeY
          • 2 Months Ago
          @raktmn
          @Letstakeawalk I think the main complaint for the Karma is that it's not particularly good at anything (aside from looks, which was definitely able to help them sell some cars). Sure, it has the plug-in side, but the Volt really outperforms it there (almost twice as efficiency in both CD and CS modes and more EV-mode range). In terms of performance, it's also nothing special (the "petro-heads" would rather see a V8 thrown in there like the Destino). Even if not for the battery plant and Katrina, it's not clear there was much demand left for the Karma (from previous articles it seems the cars destroyed by Katrina were at the dock because the demand had already dried out). And on a related note, when people have PHEVs they seem to not care about EV-mode efficiency (as if the electricity is free). But when you factor that in, you actually can't get more than 100MPGe with the Fisker and 52MPGe is quite bad for an EV.
          Letstakeawalk
          • 2 Months Ago
          @raktmn
          I never understood the complaint about Karma mileage either. The Karma can easily go 40 miles on a charge. That would be plenty for my commute, and for most people that I know who live near me. That means, on a daily basis, we would use *no* gas. That's great! But somehow, some people would rather knock it, than acknowledge that the Karma really is an amazing automobile.
          raktmn
          • 2 Months Ago
          @raktmn
          Complaining about "only" 52 MPGe cracks me up too. Complaining about an EPA combined rating of 52 MPGe? Let's put this in the correct perspective. According to fueleconomy.gov, that is better than any Hybrid vehicle that they rate. The best rated hybrids are all rated at 40-50 MPG combined, making the Fisker Karma rated better then all of them. We like hybrid cars here at ABG because of their good EPA ratings, right? This is getting rated better than other green cars we all consider to be perfectly good green cars. When 52 MPGe is compared to the national average of gas cars, it is 2 times more efficient, with the average for all gas cars being around 25 MPG. Of the best rated non-hybrid gas cars, not a single one of them gets more than 40 MPG in the combined cycle. Yet we talk about non-hybrid gas cars that get better than average MPG as "green" cars all the time. Why bash Fisker for a rating that beats every single gas and hybrid cars that we all applaud as being great green cars on a regular basis? Despite having a lower MPGe rating than other electric cars, the Karma still earns a 10 out of 10 rating for emissions and fuel economy. Since when do we bash cars that earn top emissions and fuel economy ratings? Besides, the MPGe rating is very, very much a YMMV significantly type of rating. Change the test cycle (to reflect different driving habits), and all the sudden the Karma is entirely capable of 112 MPGe. Like I've said before, and can never emphasize enough, with PHEV's more than any other car, each person's own personal driving habits have a huge impact on how efficient a car will be for that individual person. http://evworld.com/news.cfm?newsid=26885
          EVnerdGene
          • 2 Months Ago
          @raktmn
          Frisker Karma .62 kw-hr/mile 20 mpg combined gas mileage https://www.fueleconomy.gov/feg/Find.do?action=sbs&id=32516 It's a bloated energy pig. Volt .37 kw-hr/mile 37 mpg combined http://www.fueleconomy.gov/feg/Find.do?action=sbs&id=32655 0 to 60 has nothing to do with green, or CO2 reduction, or reducing our oil imports, or national security, or burning food for fuel (ethanol)
          raktmn
          • 2 Months Ago
          @raktmn
          It still cracks me up to hear people talk about a sub-6 second 0-60 car like the Fisker Karma as "slow", on a website that regularly has stories about the Volt (9-seconds), Leaf (8-seconds), Prius (10-seconds), etc with very little mention of performance. Heck, according to Tesla, they rate their 60 kWh Model S at the EXACT SAME 5.9 second 0-60 rating as the Fisker Karma!! Yet I've never heard anyone call the Model S 60 a "slow" car.
          JakeY
          • 2 Months Ago
          @raktmn
          That's not that accurate. MPGcs doesn't matter if you have a big EV%, but it does matter if you don't (for an example sort the voltstats number by EV% ascending). The Volt starts with a 37mpg sticker MPGcs so it's already at an advantage vs. the Fisker. The problem with the Fisker is that both its EV MPGe (54) and hybrid MPG (20) is low because the car as a whole is inefficient. The Atlantic was supposed to fix this.
          raktmn
          • 2 Months Ago
          @raktmn
          Jake -- Yes, the EV% is what matters. That's my point. Try this. Goto voltstats.net and sort by MPGcs. Then page down through the results. You are just as likely to see a bunch of triple digit MPG ratings no matter what the MPGcs is rated at. It is not intuitive, but the numbers don't lie. The distribution of 100+ mpg ratings is completely independent of MPGcs. This is how YMMV matters so much for PHEV's. A lot of Volt drivers are real road warriors, putting huge miles on their Volts. That is why a lot of them chose Volts, because they were the best match for their personal driving patterns. But there is no reason why someone who isn't a road warrior, and drives fewer miles every day, can't also get 100+ MPG out of a Karma. Yea, I'm hoping the Atlantic will be better. But this idea of bashing the Karma for MPGcs is silly. Because anyone who chooses to buy a Karma, who does so knowing that their personal driving patterns will net 100+ MPG, and will drive 60 or 70 percent or more on electricity will be driving very green. Getting 100+ MPG is good, right? That's why we are here on a green car website, is to save lots of gas, right? .
          m_2012
          • 2 Months Ago
          @raktmn
          I understand it better than most. The Fisker will never see anywhere close to Volt mileage. Its was never designed to be effecient, but sadly doesn't perform very well either. Insane weight, poor motor, high output gas engine paired with a not so great generator. It never had a chance at being fast or frugal.
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