ZAP Cars

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Officials for ZAP have chosen Franklin, Kentucky as the site where it will assemble electric vehicles in Kentucky. The planned $84 million plant will sit on more than 225 acres at the Wilkey Industrial Park in Franklin. Measuring about 1 million square feet, the facility will initially hire 1,200 workers and eventually employ about 4,000 people. [1] The company was drawn to Kentucky's centralized location (to help reduce costs)[1] and by $48 million in incentives and 160 acres of land of of the Rob Wilkey Industrial Parkway. Economic Development Secretary John Hindman said the state incentives will allow the company to keep 3 percent of employee state withholding taxes for each job created[2].

The company makes electric cars ranging from three-wheel runabouts (essentially an enclosed motorcycle) with top speeds of about 40 miles per hour and costing a little more than $10,000 to four-wheel cars and four-wheel drive electric trucks with prices up to $63,000. CEO Randall Waldman said the plant has a capacity to assemble up to 500 vehicles a day. Depending on how many days or shifts the plant operates, that could be as much as 180,000 units or more a year. [2]

About 50 U.S. dealerships sell ZAP vehicles, although none is in Kentucky, and officials are looking to expand those dealerships to 150 nationwide. Currently, ZAP cars are only made in a plant in China. [3]

In November of 2008, it was announced by Randall Waldman that plans to built the ZAP manufacturing plant had been halted. According to Waldman, GE Capital had backed out of their "verbal commitment" to buy $125 million in bonds issued by his company, Integrity Manufacturing; which would own a minority interest in the plant[3]. GE Capital has publicly stated that they never made a commitment to buy the bonds needed to build the plant[4].

Interestingly enough, the economic feasibility and survivability of a manufacturing plant for ZAP should be questioned, since the company has not turned a profit for any of the last 3 years. http://finance.yahoo.com/q/is?s=ZAAP.OB&annual

Media mentions

ZAP Cars have garnered a fair amount of media attention, and praise from green groups throughout the country.

Links to mentions that ZAP electric cars have garnered in the media. Wired.com[5] Cnet[6] Zimbio[7]

Electric cars can be hot!

Take a look at these youTube videos to get an idea of how fast electric cars are gaining.

Global competition for electric vehicles

The increase in gasoline prices is stimulating the demand for electric vehicles

Influence on the surrounding community

Adding 1,200 to 4,000 new jobs would make ZAP the largest employer in Simpson County.

What government and corporate leaders are saying about ZAP

Public leaders gush at the economic prospects promised by ZAP

Economic incentives offered by government

State-provided incentives are deemed as necessities to attract major new employers to Kentucky given its relative lack of economic competitiveness.[4]

ZAP's credibility questioned

ZAP has a track record with industry partners and dealers that brings into question the rigor of its business plan for a Simpson County manufacturing plant.

ZAP Management - a chronology

The absence of a competent management team has held ZAP back in the past. CEO Steve Schneider, on behalf of management, addresses shareholders in this December, 2007, letter here.

Status

September 2008

Ground was broken in Franklin, Kentucky at the site of the new car manufacturing plant.

November 2008

Shares of ZAP Cars were trading at .35 cents a share. On November 20 it was announced that a major partner in the funding for the ZAP facility backed out and progress on the project was brought to a halt until further funding could be found. [5] According to research conducted by the blog GreenKY, the ZAP cars project was sold to the Kentucky government in part by claiming that GE had already invested $125 million dollars to the company which would bring 4000 jobs to Sheperdsville, Kentucky. In fact, GE had never made a commitment to giving ZAP or Integrity the money they claimed. [6]

Leaders involved in the decision

External links

References

  1. Franklin lands electric car plant
  2. Electric car company coming to Franklin, Ky.
  3. ZAP plans to move fast
  4. How Kentucky's economic competitiveness compares to other states
  5. Proposal for ZAP car plant idled retrieved November 21, 2008
  6. GE Capital: There was no financing deal for electric car plant retrieved December 2, 2008