Bloomberg News

Fisker Karma Fire in Texas Garage Being Probed by NHTSA

May 18, 2012

U.S. auto-safety regulators are joining inquiries into a Texas garage fire that destroyed a Fisker Automotive Inc. Karma, a $103,000 plug-in electric vehicle.

The U.S. National Highway Traffic Safety Administration sent investigators to help investigate the cause of the fire at a home in Sugar Land, Texas, that Fisker learned of May 3, Claude Harris, the agency’s director of vehicle safety compliance, said today.

“We are conducting an ongoing field inquiry for an EV incident in Texas,” Harris said at a Transportation Department electric-vehicle safety forum in Washington. “We are still engaged in that activity, and no determination has been made at this time.”

Lynda Tran, an agency spokeswoman, confirmed that the Texas inquiry is of the Fisker fire.

Fisker, based in Anaheim, California, received $529 million in electric-vehicle loans from the U.S. Energy Department to develop the Karma and a proposed second model, the Atlantic. The credit line was frozen last year after the company was late in meeting milestones related to the Karma, which is made in Finland.

‘Routine,’ Fisker Says

Roger Ormisher, a company spokesman, called the inquiry “routine.” The company is working with NHTSA and insurance adjusters to determine the fire’s cause, he said.

“We also understand that the officials looked at other vehicles involved in the fire too,” he said in an e-mailed statement.

“The lithium-ion battery of the Fisker Karma was fully intact after the fire and has been tested and is in full working condition. Currently, the precise ignition source and cause of the garage fire is still to be determined.”

NHTSA’s inquiry is one in a series the agency has done of incidents involving electric vehicles equipped with lithium-ion batteries, Harris said. Others include a fire in North Carolina last year that was determined to not have been caused by the electric car, and an incident in which a General Motors Co. (GM:US) Chevrolet Volt caught fire three weeks after the agency performed crash tests on it.

Fisker officials said May 8 that the car couldn’t have caused the fire because its battery was intact and wasn’t being charged at the time. The vehicle was purchased after the recall of Karmas with defective battery packs supplied by A123 Systems Inc. (AONE:US)

Loan Defended

It made those statements after a Fort Bend County, Texas, fire investigator was quoted by Auto Week, an industry publication, as saying the fire originated with the vehicle.

The Energy Department, whose loan programs are subject to congressional scrutiny, defended its loan to Fisker in a letter today to Republican Senators Charles Grassley of Iowa and John Thune of South Dakota.

The pair had asked the agency last month to respond to questions about the loan to Fisker, which they called “one of the more unusual recipients.” Ford Motor Co. (F:US), Nissan Motor Co. and Tesla Motors Inc. (TSLA:US) also received Advanced Technology Vehicles Manufacturing loans.

Months of Diligence

“Like the due diligence performed on all ATVM applications, the department’s due diligence for the Fisker loan was extensive with rigorous financial, technical, legal and market analysis conducted over many months by DOE’s internal professional staff, including qualified engineers and financial experts and outside experts,” David Frantz, acting executive director of the department’s loan programs office, said in the letter.

Grassley and Thune said the response ignored the questions they posed.

“There’s also a lot of discussion of the due diligence that went into making the loan but no evidence to show what that due diligence actually was,” Grassley said in an e-mailed statement. “I intend to follow up for a more thorough response.”

Representative Andy Harris, a Maryland Republican who is chairman of the House Science Energy and Environment Subcommittee, also sent a letter today to the Energy Department asking for information about its advanced-vehicle spending, including grants given to Ecotality Inc. (ECTY:US), which installs vehicle-charging infrastructure.

To contact the reporter on this story: Angela Greiling Keane in Washington at agreilingkea@bloomberg.net

To contact the editor responsible for this story: Bernard Kohn at bkohn2@bloomberg.net


Best LBO Ever
LIMITED-TIME OFFER SUBSCRIBE NOW

Companies Mentioned

  • GM
    (General Motors Co)
    • $33.91 USD
    • 0.20
    • 0.59%
Market data is delayed at least 15 minutes.
 
blog comments powered by Disqus