After many signals suggesting that it would happen, Fisker has officially filed for bankruptcy.
The chapter 11 filing came late Monday night in Delaware, where Fisker is incorporated. Soon after, Fisker posted a statement on its website.
In the statement, Fisker blamed “market and macroeconomic headwinds that have impacted our ability to operate efficiently.” It is seeking to sell its assets under bankruptcy, which number somewhere between $500 million and $1 billion in value.
The statement continues with some details that may be of interest to customers, including the mention of “preserving certain customer programs” while the company continues “reduced operations.”
The announcement doesn’t come as a surprise, as Fisker reportedly hired bankruptcy consultants in March, and missed a loan payment earlier this month. It had sought investment from a “large automaker,” thought to be Nissan, but those talks fell through. And last month, Fisker filed for the equivalent of bankruptcy in Austria, where its contract manufacturer Magna Steyr is located.
LOS ANGELES (June 17, 2024) – Fisker Group Inc. (“Fisker”), the operating subsidiary of Fisker Inc., today announced that it filed for Chapter 11 protection in the District of Delaware on June 17,2024. It is in advanced discussions with financial stakeholders regarding debtor-in-possession financing and the sale of its assets.
“Fisker has made incredible progress since our founding, bringing the Ocean SUV to market twice as fast as expected in the auto industry and making good on our promises to deliver the most sustainable vehicle in the world,” said a Fisker spokesperson. “We are proud of our achievements, and we have put thousands of Fisker Ocean SUVs in customers’ hands in both North American and Europe. But like other companies in the electric vehicle industry, we have faced various market and macroeconomic headwinds that have impacted our ability to operate efficiently. After evaluating all options for our business, we determined that proceeding with a sale of our assets under Chapter 11 is the most viable path forward for the company.”
Fisker’s previously announced manufacturing pause will remain in place. Fisker intends to file certain customary motions with the Bankruptcy Court to ensure its reduced operations are able to continue, including paying employee wages and benefits, preserving certain customer programs, and compensating needed vendors on a go-forward basis. Fisker Inc. and other U.S. subsidiaries, as well as subsidiaries outside the U.S., are not included in the Chapter 11 filing at this time.
Fisker statement on its bankruptcy filing
So, Fisker has been on the ropes for some tim, showing significant financial difficulties for most of the past year.
The company was able to start delivering its Ocean SUV just about a year ago, reportedly even with positive gross margins due to its contract manufacturing structure.
However, it ended up having sales and inventory problems over the past several months. While Fisker has produced around 10,000 vehicles, it had only delivered about half of those at the close of last year (which is the most recent information we have – Fisker didn’t file a quarterly report in Q1 of this year). Fisker recently cut prices on its inventory vehicles after pausing production and trying new sales methods to try to draw down inventory.
We were some of the first media to get an Ocean for an overnight review back in November, and we found it an attractive vehicle with some neat features, but that all parts of the vehicle’s software were simply not ready for prime time. Reviews by other media mostly echoed these same points. Software updates eventually fixed some of these problems, while leaving many others intact.
During its rocky Ocean launch, Fisker still introduced some hot new concept vehicles last year – the Ronin supercar, Alaska truck, and Pear utilitarian economy vehicle. We were particularly looking forward to the Pear, but today’s announcement suggests we might be waiting forever.