Karma Automotive Comes Up with $100M in New Funding
Rachel Uranga is dot.LA's Managing Editor, News. She is a former Mexico-based market correspondent at Reuters and has worked for several Southern California news outlets, including the Los Angeles Business Journal and the Los Angeles Daily News. She has covered everything from IPOs to immigration. Uranga is a graduate of the Columbia School of Journalism and California State University Northridge. A Los Angeles native, she lives with her husband, son and their felines.
Luxury electric carmaker Karma has found a lifeline with $100 million in new funding as the company and its parent look to cash in on the popularity of Tesla in order to raise $300 million, Bloomberg reported.
The Chinese-owned company formerly known as Fisker Automotive has struggled to break out in the capital-intensive world of carmaking. Owned by auto-supplier Wanxiang Group, which bought the company in 2014, Karma is selling stakes to private equity partners, according to the report. By raising cash from U.S. investors, Karma officials aim to reduce Chinese ownership below 50%, making it easier to win government fleet contracts.
A Karma spokesperson confirmed the deal but said the company would not release details because it has signed non-disclosure agreements with their investors.
But the president of Wanxiang's U.S. business Pin Ni told Bloomberg that "Karma has real production, real technology and real dealers."
"Look at Tesla's value and you see Workhorse with their stock going up ten times recently." He denied recent media reports the company was near bankruptcy.
Karma is best known for its $135,000 Karma Revero. Last February the company laid off 60 workers in a move to restructure its business. At the time, it said it was billing itself as a "high-tech mobility incubator" that can manufacture, design and engineer for larger car manufacturers that are sinking billions of dollars into capital for new green cars. Several new executives were also brought in. In April, the company went through another round of layoffs. According to state data, 60 people were let go.
This story was updated at 2:55 pm PST with a comment from a Karma spokesperson.
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Rachel Uranga is dot.LA's Managing Editor, News. She is a former Mexico-based market correspondent at Reuters and has worked for several Southern California news outlets, including the Los Angeles Business Journal and the Los Angeles Daily News. She has covered everything from IPOs to immigration. Uranga is a graduate of the Columbia School of Journalism and California State University Northridge. A Los Angeles native, she lives with her husband, son and their felines.
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