Norway's electric car maker Think has 2000 vehicle orders and no capital

Sunday, May 10, 2009

Norway's Think is an electric car maker that has a product called the Think City that is pretty close to perfect for an electric vehicle at current technology that the average person can afford. It looks nice enough, costs under $20,000, goes 210 km on a single charge, has a maximum speed of 105 kph (the only highway certified electric car besides the ones Tesla makes). If you've never seen this car before first take a look at these two videos. The first one is in English and gives a good introduction to the car and the company's aspirations in the United States, and the second is in Dutch and simply shows what it's like to drive it.

As the first video shows, the car maker is looking to start a plant in the United States as well, and Oregon in particular is very interested in this, along with seven other states. The plant would be able to provide 300 high-paying jobs in the beginning, then up to 900.

Unfortunately, even though they've already manufactured 1000 vehicles, they've been under the equivalent of chapter 11 for a few months now and so they need every piece of good news they can get to continue to operate and hopefully expand. This article in Norwegian from two days ago details some of the new orders they've received, and the huge problem it still faces re: capital. Some parts from the article:

There is "hope in the hanging rope" for the crisis-affected electric car producer Think: in the spring it signed two major supply contracts.

The latest is a delivery agreement to the Spanish distributor Going Green in Madrid. (note: Think's press release in English is here) The order is for 550 cars, which will be delivered from late summer this year and the first half of 2010.

The Spanish government has offered a large financial package of ten million euro to speed the introduction of electric cars in the country. The package provides for purchase of electric cars and the commencement of electric car pilot programs. These cars can go to cities, states, individuals or companies, said spokesperson Katinka von der Lippe in Think.

In March the Netherlands made an order for 500 Think cars, and the first eight are already making their way around Amsterdam.
Great! But the problem is that Think has no capital.
"We have agreements in more or less all European countries. If this trend continues we can foresee more orders", said von der Lippe.

But the orders have zero tangible value. Think has neither money to buy the parts needed to put cars together, nor the workforce. The number of employees is down to 57.

"We are not producing at the moment because we have no working capital. We have orders for over 2,000 cars and the capacity to produce 5,000 a year. As soon as we get new capital we can start to produce", said von der Lippe.


"How realistic is it that production of the cars can begin with new capital?"

"We have dialogues outside Norway, but hope for a split Norwegian solution for financing..." as for exactly how much capital is needed she won't say.

And on the American connection:

Think also has a loan application for money from Obama's crisis package in the US. This application has no value as long as the company has no money.

During the spring there were also rumours of Saab and Think joining together.

The question: how does Think get out of its current rut?


Anonymous said...

There must be entrepreneurs who realize that the slow death of the big three means huge opportunity for brands of the future like Think -- pretty close to the perfect car for this moment, even without lithium power. ANd ready to go - no new development costs. Maybe Tesla could market Think as their low-end mass market product? I write from Quebec, Canada where we're flush in Hydro electric power and could easily incentivize the production and adoption of Think and keep billions of energy dollars in our local economy. Only thing missing is the leadership and vision.

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