Zap counters hype machine story with yet more press releases {Autoblog Green}

Apr 8th 2008 12:39PM And this from the LA Times April 5.

Lots of promises

Santa Rosa, Calif.-based Zap has repeatedly made promises that it hasn't been able to fulfill. The publicly held company sells electric scooters and low-speed, three-wheel cars, and CEO Steven Schneider says Zap plans to sell a highway legal three-wheeler starting next year.

Online stock trading message boards accuse Zap of operating as a "pump-and-dump" shop that attempts to raise the value of its stock temporarily by aligning itself with hot transportation trends. Schneider denied that, saying "moving the stock around doesn't help us."

The company has put out 26 news releases this year, and in December issued one headlined, "Zap not acquired or bombed by warplanes according to news reports." In the last several years, it has announced plans to sell a hydrogen fuel-cell vehicle, an ethanol vehicle and a 644-horsepower electric sports sedan. None has materialized.

Zap is in litigation over its 2005 attempt to sell Daimler's Smart Car in the U.S. without a license from the automaker. Zap purchased them from European dealerships and shipped them here. It also faces nearly a dozen unrelated suits, including fraud and breach of contract.

In the last four years, Zap's stock price has gyrated between 26 cents and almost $5. It hit its 2008 high of 89 cents in January, shortly after announcing that it had created an "electric car made for iPod" -- one of its low-speed models with an input jack for the digital music player. The shares are now at 52 cents.

"We put out a lot of news because it's a vicious market and we need to remain in the news," Schneider said. "Shareholders call screaming, 'We want news, we want news,' and so we give it to them."