Coda Automotive, which wants to develop a Chinese-U.S. electric car, has raised $76 million in a fourth round of funding.
It is good news for the company, which has recently struggled. In October, former CEO Kevin Czinger resigned and was replaced by interim Steve Heller. The company then delayed the release of its car from late 2010 to the third quarter of 2011. Heller is not the "scale-up" CEO to bring manufacturing expertise to the company. Like Czinger, he's a Goldman Sachs alum.
The delay hurts, but isn't fatal. General Motors and Nissan will only have put out limited numbers of Volts and Leafs by the third quarter of 2011. A bigger problem is in low prices. Coda's car will cost $45,000 before rebates and incentives. The Leaf costs $32,000 and the Mitsubishi i, an all-electric from that company, will sell for $30,000 when it arrives in the fall of 2011. Both Nissan and Mitsubishi are well-known names already. Coda will have to build a brand for itself. Early demand, however, continues to outstrip supply for electric cars in total, so Coda, at a minimum, will likely enjoy a rabidly curious public.
Czinger told us last fall that Coda was trying to raise $60 million to $125 million in this round. $76 million is clearly in the lower half here, but they still raised the money, so hats off to them. The round is also still open, so $50 more million could arrive. Then again, the new investors are Harbinger Capital Partners and Riverstone Holdings -- and Harbinger is said to live up to what its name implies. (UPDATE: Coda told us that $75 was the target for the first part of the fund.)
Coda's car is based around a gas-burning car on China's streets now that has been retrofitted extensively to run on batteries and meet U.S. safety and consumer standards. U.S. engineers have overseen the retrofit process and the original design of the car comes from Japan. The car will be manufactured in China, but some final assembly could occur in the states. Is it a Chinese car or not? Czinger and I couldn't agree, and neither could two well-known car reviewers. You decide.
The batteries from the car come from Lio Energy Systems, a joint venture between Coda and Lishen. The picture, taken at the L.A. Auto Show, shows the battery. Lishen's largest shareholder is the China National Offshore Oil Co -- you know, the guys that won the Iraq war. Lio, which has received extensive credit from Chinese banks, is currently seeking a DOE loan to build a factory in Ohio. If they can get that loan, it will be an incredible intermingling of national energy plans. And, what's more, former Treasury Secretary Hank Paulson is an investor.
Tom Friedman will be wrinkling his brow for weeks.