Video: Detroit, watch out for this Karma

On a test track in Southern California, a radical new car is getting its first workout.

The zebra stripes camouflage it from competitors, but you still get a good sense of the Fisker Automotive Karma, the brainchild of designer Henrik Fisker, who's trying to succeed where Detroit so far has failed, CBS News business correspondent Anthony Mason reports.

"The vision is to do a high performance, luxurious, sexy-looking car which gets better miles per gallon than the Prius," Fisker said.

The Karma is a plug-in hybrid. It can go 50 miles on an electrical charge before a gas engine kicks in to power its lithium ion battery.

"The average driver will get something around 100 miles per gallon," Fisker said.

The Karma's top speed is 125 mph. The initial price tag: $80,000. But within a few years, Fisker hopes to produce a $40,000 version of this lean, green machine.

It's got other Earth-friendly features.

"The entire roof's a solar panel," Fisker said. "Actually it's the first curved solar panel in the world."

The Danish-born Fisker, who was a designer at BMW and Aston Martin, then owned by Ford, grew frustrated by the bureaucracy at the big car companies, so he started his own.

"We don't have the overhead that plagues a lot of the large car companies. And we can move extremely fast," he said.

Unveiled at the Detroit Auto Show in January, the Karma is scheduled to become the first plug-in hybrid on the road late next year, well ahead of Chevy's Volt.

For all the debate over whether the U.S. government should bail out Ford, GM and Chrysler, consider the biggest investor in Fisker is the Persian Gulf nation of Qatar. They've poured nearly $60 million into the car.

When the U.S. rescue package is discussed, the California-based Fisker is never mentioned.

Should the government be giving them some of the money?

"I think they should actually because we are pioneers," Fisker said. "We are coming out, leading the way and showing how it could be done."

Small, nimble and fast--in the future the American auto industry may need to look a lot like Fisker.

[aj37viggen]

"When the U.S. rescue package is discussed, the California-based Fisker is never mentioned.
Should the government be giving them some of the money?"

The U.S. rescue package proposes loans to the large car-makers because (1) they employ huge numbers of people; (2) have a vast economic impact through supply purchases, research expenditures, etc.; and (3) are taking an especially hard short-term hit from consumers' reluctance to spend on big-ticket items. (European governments are making loans to their car makers for the same reasons.)

None of this applies to Fisker, which (1) doesn't have a large payroll; (2) isn't a significant spender in the auto-industry segment; and (3) isn't affected by the sales downturn because it DOESN'T HAVE A PRODUCT ON SALE.

In view of that, why is the reporter even asking the question? The purpose of the "rescue package" is to mitigate large-scale economic damage, not reward the generators of cool-looking vaporware. Oh, I forgot, this is C-Net; we're all about cool-looking vaporware here...

[bigpicture]

Do you remember the term "sunset industry" maybe not, it was used in relation to Detroit about 20 years or so ago. It still applies today, big, bureaucratic, inefficient, and sunset, or just plain fading away.

Time and again it has been proved if a company "knows the market" and produces innovative products that that market wants and needs, and provides "perceived value", (what you get for what you pay) they will be successful.

The margins are small in center market (where most are) and they have to be very innovative to distinguish their product from the rest, and production efficient so that they can be price competitive and still have a reasonable margin.

That is the "center market" and it is hard to compete there, but if they concede "center" then they lost the market. Detroit took the lazy easy route, and went to the "market edges" with "high margin" luxury SUV and pick-up truck type vehicles etc. Not really innovative, and also small market segment. The problem is that for the others who can compete in "center market", competing at the market edges is easy, and they can squeeze out the competition.

If you don't believe about "knowing the market demand" and providing matching product, look at the I-pod and the I-phone, and then look at the Zune. Look at Wii and then look at the X-box. Just because MS is big, arrogant, and monopolistic, that is not what gets market share, or in the long run even keeps market share. Detroit is only the first in a long list of dinosaurs.

[wwhit710]

Sounds great and all, but still waiting for Tesla to do anything real...how many cars have they made and sold...is it more than 10? (@110,000 ea.)

Fisker all well and good also, but lets see the product when they claim before running an article already claiming that they have beaten everyone to the punch. At $80,000 is not a car for the purchasing public...for that matter the Volt won't be either.

[renGek]

People who generally care about saving gas are the type of consumers who would not spend $80K on a car. The two are somewhat exclusive. These cars would be gear towards celebrities who wants everyone to know they are green because they really don't care about saving $100/month on gas. Thats pocket change to them. As suggested, this car is gear towards luxurious. Thats not the mainstream. Even if they are able to get a car down to $40K, I think a lot of people would still look to the competitors. But maybe the technology will trickle down to other companies.

[MadLyb]

Let's think about this.

If this car was just a regular gas vehicle, it would be lucky to price out around $40K and that is being generous.

So, there is a premium of about $40K which, even at $5/gal would buy 8,000 gals of gas. Now, they are claiming around 100 mpg, and let's again be generous, accept that and say the comparable gas vehicle would be around 25 mpg, so we have a differential of 75 mpg.

This means you would have to drive the car 266K miles just to break even on the gas. Now, I have driven some great cars over the years, but after 100K, they started showing their age and I have not been able to keep one past 150K. Also, I didn't include any other maintenance costs specific to the vehicle (batteries, chargers, solar cells, regenerative braking systems, etc.). And this is a first generation, very tech laden product.

What are the odds, I would even get close to 250K out of it? Not much.

So, if you have the money and feel the need to make a statement, go for it, but like it's other cousins like Tesla, I will pass.

[Holly Klug]

The obvious question is what happens to the price of batteries if these were to become popular?

I think the peak oil people hit the nail on the head when they ask what is the energy returned on the energy invested?

Rich people will pay big money for an unusual car. Will the US railroads pay to electrify? Probably not. Will the Honda Civic ever be replaced by an electric? If fuel costs skyrocket again, it is much more likely we will all be driving a lot less, as we are now, bringing the consumption down to what can be comfortably be pumped out of the ground. Bicycles will be rediscovered by the 1st world.