Better Place's deputy CEO quits
Moshe Kaplinsky's resignation undoes efforts to steady troubled firm
The crisis at Better Place appears to be deepening.
A month after the surprise departure of founder Shai Agassi, the electric-powered automobile infrastructure company lost its second big name yesterday with the equally surprising resignation of Moshe Kaplinsky.
The company is searching for a new business model, and Kaplinsky's exit apparently stems from disagreements with company chairman Idan Ofer, who controls the company through the Israel Corporation, and Australian Evan Thornley, Agassi's successor as Better Place CEO.
In an effort to project an image of post-Agassi stability and strengthen the new management, Better Place last month promoted Kaplinsky to deputy chief operating officer of Better Place's worldwide operations in addition to his post as Better Place Israel's CEO. He had headed Better Place Israel since 2008.
The changes at Better Place will not improve its chances of increasing sales of its electric vehicles, at least not in the short term.
Better Place said Kaplinsky will remain on until the end of the year, and will be replaced by CFO Alan Gelman. Gelman is the CFO of Better Place worldwide, and just joined the company after serving as CFO and deputy CEO of Bezeq, and was previously the CFO of Yitzhak Tshuva's Delek Group.
Kaplinskyis a former major general and Israel Defense Forces deputy chief of staff, sent out an email to all employees trying to explain his reasons for leaving. He said he had been considering the move for a long time, but felt a managerial and moral obligation to remain until Thornley took over and finished acquainting himself with the organization.
Kaplinsky, speaking at a Tel Aviv press conference about a month ago, expressed optimism about Better Place's future and pledged to continue leading it. His responsibilities included the deployment of electric-car charging stations in Israel and for initial marketing of the vehicles; Tal Agassi, the younger brother of Shai who also resigned, was previously in charge of the Israeli charging infrastructure.
The retired general's future plans are not clear. In recent weeks, various political parties have asked Kaplinsky to join their ranks and compete in the upcoming Knesset election.
Better Place has been recently experiencing a cash crunch, requiring an urgent $100 million injection of cash after stepped-up spending in the third quarter of 2012. The company, which reported losses of $132 million in the first half of this year, has a negative cash flow of $104 million since January 1.
The cash-starved company recently sought to raise 200 million euros from institutional investors. When that failed, it turned to investors - including the Israel Corporation - with a request for $150 million. In the end, only $100 million was raised; after other shareholders wouldn't pour more funds into the company, the Israel Corp., which owns 28 percent of Better Place, provided two-thirds of the cash injection.
Better Place has been negotiating recently with Renault-Citroen to change the agreement between the sides. Better Place has a commitment to purchase 100,000 Renault Fluence ZE electric cars by 2016, and is well behind schedule in meeting this goal. But Better Place has not provided Renault with any guarantees concerning its commitment, and may not have to compensate Renault if it does not meet the target. Renault manufactures only small numbers of the electric Fluence, and only to order.
Heavy losses prompted the Better Place board to oust Shai Agassi in early October. The company has not come close to meeting the performance targets presented to institutional investors earlier this year. At that time, it anticipated a 23 million euro cash flow deficit for the entire year. But it ended up generating an 80 million euro deficit in the first half alone.
Electric car sales in Israel have also been a major disappointment. The company expected to sell 4,000 vehicles by June 2013. Through the end of October, sales were less than one-eighth of that figure, totaling 490 cars, including only 33 in October. The 11 million-euro revenue figure for 2012 also seems remote; turnover in the first half was only 1.9 million euros.
So far, 38 of a planned 45 battery-charging stations have been built in Israel.
Better Place confirmed that Kaplinsky has left his post.
Like us on Facebook and get articles directly in your news feed