Fisker Automotive, the manufacturer of the Karma hybrid luxury vehicle, can file for Chapter 11 bankruptcy protection as early as this week, people familiar with developments at the company revealed.
According to the sources, the green-car startup is under intense pressure from the side of the U. S. Department of Energy repay around $200 million in government loans.
The sources added that the company's attorneys have already drawn up documents for the Chapter 11 filing and the application could be submitted in the next few days.
Luxury electric vehicles maker Fisker Automotive is recalling 239 Karmas plug-in hybrid sports cars to fix a battery problem that could result into fire.
In a report filed with the National Highway Traffic Safety Administration, Fisker admitted that there was a possibility that hope clamps in some cars were not properly positioned, which could lead to a coolant leak and fire.
Admitting the fault, the luxury car maker said, "If coolant enters the battery compartment, an electrical short could occur possible resulting in a fire."
The US firm, Fisker Automotive, is reported to be in plans to build five more models by 2016, its Chief Executive, Henrik Fisker posted. The Company is also in plans to unveil its rechargeable hybrid sports car.
Fisker is tagged among the two top automobile giants showcasing their designs in Paris that are planning a first-mover advantage in premium plug-in cars. This will be possible with the help of the US Government’s money and cheap the manufacturing assets which have been sold, following the crisis engulfing the Detroit car industry.