The Little EV That Couldn't: High Prices Lead Think into Bankruptcy
It didn't have to happen this way. The Norwegian EV maker Think (sometimes seen as Think!) filed for bankruptcy in Oslo on Wednesday, actually it's fourth time through the courts. This time it feels permanent, though.
It's a shame, because the Think City, with two seats, a plastic body and 100 miles of range, could have worked. It failed for a very simple reason--it was too expensive, considering what you got. I went into sticker shock when, on a visit to the factory in Indiana, I saw a fleet price of over $40,000 on the window. At that price, only a few booster-minded Indiana park rangers were going to buy it, and that's indeed what happened. The company sold only 1,043 cars in 2010.
Think has a colorful history. The newly opened Indiana factory was not its first venture in the U.S. The company, founded as Pivco in 1991, was owned by Ford from 1999 to 2003. During that brief period, I drove one in Michigan and found it amusing, if somewhat Spartan. But Ford's timing was terrible, because it wasn't until 2008 that high gas prices and better battery tech really created a market for EVs. Think went through a number of owners, and its flagship was always the City car which had enjoyed considerable design input from Ford.
I wanted Think to work. It's a scrappy little contender, and fun to drive. But like the Coda and the Wheego LiFe it has a pricing problem. The retail price of $36,495 is $4,000 more than the Nissan Leaf, with four seats and lots of cool interfaces that let you find an available charging station, check how many miles to empty, and rate the different draws on the battery.
On top of that plain advantage, the Leaf has a huge edge in Nissan's huge dealer network, advertising budget, and free publicity as the star EV on the block. On that visit to Indiana, Think told me that the car's early adopters would be large fleets, but they had plenty of other choices. I talked to CEO Barry Engle, and he made sense when he said the Think brand would stay small in more ways than one. "The city car is where we are and where we play," he said. "We have to stick to our knitting, which is congested urban environments."
I agree that Think's niche was tiny city cars, but not at $40,000. Back in May, Think's battery supplier, Ener1 (also a 40-percent owner), decided it wasn't going to put any more money into Think. CEO Charlie Gassenheimer told me the way out for Think was to price the car very low, at $15,000 perhaps, and then lease the battery pack separately for maybe $100 or $200 a month. I'm not sure that plan was financially viable, and Think's board didn't play along, but it would have put a lot of new customers into Think driver's seats. And it would have gotten the company rolling in the U.S. Think, the affordable EV--it would have had a ring to it.
Think's prospects are kind of grim. The U.S. operation is independent of the headquarters in Norway, but it hadn't ramped up for U.S. production yet and so was doing final assembly on cars built at the factory in Finland--which is now shut down. It needs a new investor, or the liquidators come in.
This outcome will be sobering for those other small EV companies I mentioned, Wheego and Coda. Wheego is actually selling cars now, but Coda, with a four-door car priced higher than the Chevrolet Volt, is on a hiatus before launch. I'd suggest that both need to figure out how to get to volume with cars that need more of a value proposition. It may be too late for other casualties like Aptera, which had high hopes for a three-wheel battery car.
Both companies are headed by smart folks, and I hope they figure it out. Tesla and Fisker (which launches its plug-in hybrid in July and August) shouldn't be the only surviving independents.
Want to know what it's like to drive a Think City, in Norway? This rather atmospheric video has the goods: