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Is Fisker's Karma sports car poised for a comeback?

Posting in Finance

Chinese auto parts manufacturing giant Wanxiang Group has big plans for defunct luxury plug-in electric hybrid car company Fisker Automotive. 

Earlier this week, Wanxiang's winning bid to acquire Fisker's assets for $149.2 million were approved by the U.S. Bankruptcy Court. It appears that Wanxiang—the same company that bought battery supplier A123—plans to bring back Fisker's Karma sports car. 

Wanxiang, in a presentation to creditors, says it plans to build hybrid Karmas alongside a gas-guzzling cousin, the Destinos, reported Reuters. The Destino is a luxury sports car made by VL Automotive in Michigan that has the same body as the Karma, but is outfitted with V8 engine. The two companies, which have been linked before, plan to team up and build hybrid Karmas alongside the Destinos.

In another report by Gigaom, Wanxiang said it would immediately restart production of the Fisker Karma once the deal to acquire the company closed. 

Fisker and A123 Systems, you might remember, have a sketchy history. Fisker suffered a number of blows in the past 19 months or so, notably problems with batteries made by A123 Systems for its luxury electric cars. In March 2012, Fisker said it would swap out drive batteries for its 2012 Karma models free of charge after customers experienced unsatisfactory performance. This was the second recall for Fisker, which preemptively recalled faulty A123 systems batteries late last year for posing a fire hazard.

Now that Fisker appears to be getting another chance at life, the question remains: will folks be willing to buy the Karma over a more proven electric car like the Tesla Model S? 

Wanxiang has a far more conservative view of the Karma's future than Fisker did back in 2012. The Chinese company expects to sell 1,000 combined Karma and Destino cars in the U.S. in the first 18 months and another 500 Karmas in Europe. 

— By on February 20, 2014, 7:17 AM PST

Kirsten Korosec

Contributing Editor

Kirsten Korosec has written for Technology Review, Marketing News, The Hill, BNET and Bloomberg News. She holds a degree from Northwestern University's Medill School of Journalism. She is based in Tucson, Arizona. Follow her on Twitter. Disclosure