Crisis loan saves car-maker Think, at least for now
January 13, 2009
The makers of Norway’s popular but troubled electric car called Think have secured a crisis loan from investors that will give Think executives more time to arrange needed long-term financing.
The cars themselves have been eagerly sought-after by buyers in both Norway and overseas, especially in the US. A series of bankruptcies and ownership and management changes have constantly prevented Think from getting its redesigned model to market.
The emergency loan amounts to NOK 40 million (about USD 6 million), but new managing director of Think Richard Canny said the company needs USD 40 million, or NOK 280 million, to get full production going. The loan was put up by Norwegian investors in the company including retailing tycoon Stein Erik Hagen and the company’s battery producer Ener1 Group. It will only ensure production for a few months, though.
Think’s history goes back to 1990 when founder Jan Otto Ringdal launched the little electric car’s predecessor Pivco. The venture attracted some major Norwegian investors including the Tiedemann Group and Møller Invest, but It went bankrupt in 1998.
The company was ultimately bought up by Ford Motor Co, which invested more than NOK 1 billion in Think, but Ford pulled the plug just a few years later. It was then sold to Indian investors until the next bankruptcy occurred in 2006. Founder Ringdal bought up Think’s remains but heavy losses continued. Last year Think attracted new investment capital, but it quickly emerged that the company lacked adequate financing for full production.
Some observers say Think has lost its credibility in the marketplace, while others still clamour for the cars. Think has boasted long waiting lists for the vehicles and newspaper Dagens Næringsliv reported it now has 56 cars ready for sale, with another 64 almost finished.
By Nina Berglund/Views and News from Norway