Electric carmaker CODA opens global HQ in LA
Electric carmaker CODA Automotive Inc. opened its global headquarters in Los Angeles on Thursday, strengthening California's bid to become the hub of clean-energy business the state hopes will create thousands of new jobs.
CODA, a startup company that began in Santa Monica, officially unveiled a 100,000-square-foot engineering, research and sales center that has more than 200 employees.
"It is a milestone. We started with a few people in a Santa Monica hangar just about four years ago," CODA spokeswoman Larkin Hill said.
"Dynamic innovation is a key building block of California's 21st century economy," Gov. Jerry Brown said at the ceremony. "Car companies like CODA are investing in California because our laws encourage electric cars and recognize the paramount importance of reducing oil dependency."
"We see it as a catalyst that will usher in new jobs, more investment, and a stronger clean-tech industry to Los Angeles," Mayor Antonio Villaraigosa said.
CODA is working on a five-passenger sedan with a range of up to 150 miles per charge. It will be manufactured in China and final assembly will take place at a plant in Benicia, Calif. The car will sell for $44,900, or $32,400 after federal and state credits for electric vehicles.
The company plans to begin sales in California this year and said it expects to sell 10,000 to 14,000 vehicles in its first 12 months.
CODA is one of several small California startups, such as Tesla Motors Inc. and Fisker Automotive, that are developing all-electric and hybrid cars as governments offer tax breaks and subsidies to promote alternative energy.
CODA chose California for its global headquarters partly because the city offered about $1.4 million in financial incentives and because of the pro-clean energy environment, which includes a $2,500 state rebate for buyers of electric vehicles, Beanum said.
"We believe California is the epicenter for the electrification movement," he said. "It's the highest concentration of what are often called early adopters. We believe that California's political leadership ... (is) dedicated to creating the infrastructure, regulatory environment and policies needed to support mass adoption."
Los Angeles, saddled with financial problems and job losses, has had some success in using financial incentives and its movie star image to lure clean-energy businesses.
Chinese electric carmaker BYD Co. opened its North American headquarters in Los Angeles three weeks ago, although it won't begin selling to consumers until next year.
CODA's other competitors include Nissan Motor Co.'s Leaf and General Motors Co.'s Chevrolet Volt.
Success might lead to more assembly plants, said Forrest Beanum, CODA's vice president of government relations and external affairs.
"This is potentially thousands and thousands of jobs," Beanum said.
CODA's strategy is interesting in that it concentrates the company's expertise on the car's powertrain and battery and puts it in a body that can be inexpensively made in China, but whether the car will sell is unclear, said Aaron Bragman, an auto analyst for IHS Global Insight in Troy, Mich.
"The product itself has been viewed with some skepticism," he said. "It seems to do what they say it will in terms of its range or performance but it looks like a 15-year-old Japanese sedan," Bragman said.
The market for electric vehicles is uncertain because the cars currently are pricey and in short supply, he said.
In addition, CODA and other small producers also lack the name recognition, national distribution systems and car manufacturing experience of larger competitors such as GM, he said.
"Are consumers going to spend what comes down to a very large amount of money with a company that is basically unknown?" Bragman asked. "They simply don't have the reach, the deep pockets, the experience or the legacy of the established automakers."