Fisker, a U.S. electric vehicle (EV) manufacturer, filed for bankruptcy protection after negotiations with a major automaker collapsed, exacerbating its financial strain due to accelerated spending to launch its Ocean SUV in the U.S. and Europe.
Under its subsidiary, Fisker Group Inc, the company filed for Chapter 11 bankruptcy in Delaware, citing assets estimated between USD 500 million to USD 1 billion and liabilities ranging from USD 100 million to USD 500 million. Court documents indicate Fisker has between 200 to 999 creditors.
Talks with a significant automaker broke down in March, prompting Fisker to explore restructuring options, both in and out of court, as well as seeking capital market transactions.
While Fisker did not reveal the identity of the automaker, reports indicated that talks were well-progressed with Japanese automaker Nissan regarding a potential investment.
Founded by Henrik Fisker, the company expressed doubts about its sustainability in February, pausing investments in future projects until securing a strategic automotive partnership.
Facing difficulties in selling its Ocean EVs, Fisker has announced a workforce reduction of 15%. Despite forecasting production of over 10,000 vehicles in 2023, the company delivered only about 4,700 units, significantly below projections.
In a further setback, the U.S. auto safety regulator initiated a preliminary investigation last month into certain Ocean EVs manufactured in 2023, compounding Fisker’s difficulties following earlier inquiries by the National Highway Traffic Safety Administration (NHTSA) into three incidents.
The company faced financial strain due to restricted access to capital in a high-interest rate environment, substantial marketing and distribution costs, and sluggish demand for EVs, exacerbated by global supply chain disruptions.
Fisker joins other EV companies like Proterra, Lordstown, and Electric Last Mile Solutions in seeking bankruptcy protection, grappling with fundraising challenges and production delays amidst broader industry pressures.
