Chinese companies in race for bankrupt US carmaker

Hybrid Tech, as a condition of acquiring the Fisker loan, is required to manufacture in the US. Wanxiang isn't bound by that agreement, although Energy Secretary Ernest Moniz said that the "terms of our loan have to be respected".

"We have technology transfer limitations," Moniz told reporters on Jan 22 at the Washington Auto Show. "No matter who the winner is, we will be looking at both engineering and manufacturing in the US. That's the key for us."

Both companies say they're interested in using the US plant.

Wanxiang America Corp President Pin Ni declined to comment while pointing to court filings that describe the closely held company's plans.

"We can immediately restart the production of the Karma sedan and provide parts and service to the existing owners," Wanxiang said in a Jan 8 filing. "Wanxiang intends to continue development of the Gen II line of cars and, once they are ready to be produced in large quantities, would build them at Fisker's plant in Delaware."

Hybrid deepened its commitment on Jan 24 by lending Fisker $13.1 million to cover its expenses.

"Together with our partners, investors, designers and suppliers, Hybrid is working to achieve a rapid relaunch of the Karma and the forthcoming Atlantic plug-in sedans," Megan Grant, a Hybrid spokeswoman, said in an e-mail. "We look forward to the acquisition of the company and a path forward for the Delaware plant."

Investors see hope for electric cars through Tesla's success and China's subsidies for electric-vehicle purchases.

Tesla co-founder Elon Musk said in January that China may become the company's biggest market. Electric-vehicle sales in China may increase 19 percent by 2015 and 27 percent by 2020, according to an October report by Bloomberg New Energy Finance.

No Chinese-made car has been certified by US regulators to be sold in the US Chinese investors bought Swedish carmaker Volvo Car Corp., which sells vehicles in the US, and Chinese companies have automaking partnerships with companies including Daimler AG and Hyundai Motor Co.

"In terms of the Chinese, they're clearly trying to get into the US markets," Lacey Plache, chief economist for auto-researcher Edmunds.com, said in an interview. "If they could get something that totally disassociates them from the Chinese car, that's a good thing."

Still, Plache said, Fisker is a little-known brand in a niche auto technology. "They're taking a bet on EVs being a stable market in the US and that's an iffy thing," she said. "It's not clear to me that Fisker has enough cachet to bring it back."