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Think, again: Norwegian electric-car maker looks for U.S. plant

Thu, 12 Mar 2009

Think, the Norwegian electric-car maker, says it plans to build an assembly plant and a technical center in the United States.

After financing failed in the wake of the collapse of credit markets in late 2008, the company entered Norway's debt-settlement process (the equivalent of Chapter 11 bankruptcy), and production of its recently redesigned Think city car was halted. It continues operating under a $6 million interim funding measure while it pursues additional financing.

Now, the 17-year-old company is in discussions with eight states that might host its production facilities, and it will file an application for low-interest U.S. government loans under the Department of Energy's Advanced Technology Vehicle Manufacturing Program.

CEO Richard Canny, an Australian who took the position late last year after a long career at Ford that included leadership of its South American operations, said that federal and state incentives for the manufacture of batteries and electric vehicles are a factor in the firm's decision to expand its North American presence.

"We're still pursuing private investment," says Canny. "The Department of Energy loan is not something we see as a substitute for capitalization, but a supplement that makes our operating plan going forward more effective."

Ford owned Think from 1999 to 2003 and invested more than $100 million to develop and produce the predecessor of the current model, which it leased to customers in California during that period. The firm was sold in 2006, and the vehicle has been updated to meet all European safety standards. Investors include Novus Energy Partners and Kleiner Perkins.

Assuming the company survives this latest brush with collapse, Canny said it aims to resume production in May and to offer its car to fleet and demonstration projects in 2010 with retail availability of U.S.-built vehicles in 2011. He said between 350 and 400 of the latest model have been built at the company's plant in Aurskog, Norway. The plant could build up to 5,000 cars per year, but in Think's entire history, it has produced fewer than 2,000 street-legal vehicles (several thousand neighborhood electrics are not included in the total).

"We're continuing to convert some inventory into completed cars, but not really in production," says Canny. "We have firm orders for another 1,500 units, about 650 of them at retail and the rest for fleets."

With the latest battery technology, the new Think city car is a step beyond the one Ford offered in the United States. Range now tops 100 miles on a single charge, versus 40 to 60 miles for the older edition, and the new one has a top speed of 62 mph. Before offering the car to American consumers, Canny said, the company aims to increase top speed to 70 or 75 mph and to further improve driving range and acceleration.

Modest as it seems, Think qualifies as a genuine pioneer in the field. It has many years of experience and, with the exception of Tesla's expensive sports roadsters, represents the primary market for today's electric-vehicle batteries.

With many of the world's major manufacturers set to enter the electric-car market in the next three years, however, Canny says that Think is eager to make the most of its leadership and experience.

"The technology is ready, there's expanding awareness and interest in the marketplace, so all it takes is the financing to make it happen," Canny says. "Unfortunately, the global economic crisis arrived just as the company was entering its most capital-intensive phase."

Kleiner Perkins and Novus Energy formerly owned the company's North American arm. In a noncash transaction, the parent company reacquired the U.S. subsidiary while the American capital investors took shares in the Norwegian company.




By Kevin A. Wilson