Fisker’s Financial Fiasco: EV Startup Declares Bankruptcy Amidst Ocean Model Troubles

Powerless: Fisker declares insolvency once more

On Monday, the electric car producer Fisker announced bankruptcy proceedings due to its inability to attract fresh funding needed to resume manufacturing of its Ocean SUV model.

In an announcement, Fisker revealed that it has filed for Chapter 11 bankruptcy at a Delaware court. The company is presently negotiating with creditors regarding debtor-in-possession financing and the disposition of its residual assets.

According to legal documents reviewed by Reuters, Fisker assessed its debts to be in the range of $100 million to $500 million, while its assets were valued at approximately $500 million to $1 billion.

Fisker rolled out the Ocean, their inaugural vehicle, about twelve months ago. Magna Steyr, a third-party producer, was in charge of assembling the electric compact crossover in an Austrian facility. However, financial difficulties led to a production stoppage in March.

Henrik Fisker alongside the inaugural client's Fisker Ocean – May 2023

Per information from Reuters, it's reported that throughout 2023, upwards of 10,000 Oceans were manufactured, yet merely around 4,700 reached consumer hands. Details regarding the assistance provided to those who own Oceans have not been disclosed by the company.

Before seeking legal refuge from its debts through bankruptcy, Fisker sought financial stability by potentially allying with a leading car manufacturer, believed to be Nissan. In a bid to clear the accumulating stock, the company also cut down the Ocean model's prices.

Apart from financial challenges, Fisker has experienced a decrease in interest for electric vehicles and faced disruptions in the supply chain that have postponed the increase in manufacturing of their model, the Ocean.

From left to right: Prototypes of the Fisker Ocean Force E, Pear, Alaska, and Ronin vehicles.

The NHTSA initiated an early-stage investigation into the Ocean model in May, following reports of occasional malfunctions with the door-opening mechanism.

Henrik Fisker has once again seen a company he established and headed, specializing in electric vehicles, fall into bankruptcy. This follows a previous venture under the Fisker name which went under in 2013, its remnants acquired by Wanxiang, a Chinese firm in the battery sector. The initial enterprise did make a comeback, however, and is currently doing business as Karma.

A financially strong purchaser might acquire Fisker's holdings, settle its debts, and recommence the manufacturing of the Ocean model. Fisker has also unveiled plans for three more potential releases: the Pear city crossover, the Alaska pickup, and the Ronin drop-top.

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