Tax-Payer Subsidized Fisker Recalls 2,400 Karmas

On Saturday, green car-maker Fisker, which was approved for a $529 million taxpayer-funded government loan, announced it is recalling 2,400 Karma plug-in hybrids after one of its vehicles caught fire last week in Woodside, California.

The incident marks the second time this year that a Fisker has caught on fire and is the latest public relations black eye for the troubled automaker.  In March, Fisker suffered embarrassment when one of its $107,000 vehicles died in the middle of a Consumer Reports test (click to watch the video). 

Karma says its latest round of recalls has to do with a faulty cooling fan.  Its last recall was attributed to problems with its battery, made by A123 Systems Inc., a company partly financed with a $249 million taxpayer-funded government grant.  A123 Systems Inc. recently announced it plans to sell a controlling stake to Wanxiang, a Chinese company, for $450 million.

Fisker entered the presidential race last month when Mitt Romney referenced it in a speech blasting crony capitalism: 

“I am ashamed to say that we’re seeing our president hand out money to the businesses of campaign contributors, when he gave money, $500 million in loans to a company called Fisker that makes high-end electric cars, and they make the cars now in Finland."

Delays to the release of Fisker's Karma resulted in the Department of Energy denying the green automaker from gaining access to over half of the $529-million taxpayer-funded loan the Obama Administration awarded it in 2009.

The struggling car company is now seeking another $150 million in funding to stay afloat.

Al Gore, Matt Damon, Leonardo DiCaprio, and Justin Bieber all own Fisker Karmas.


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