EV maker files for bankruptcy after hemorrhaging cash
California-based electric vehicle maker Fisker filed for Chapter 11 bankruptcy protection on Monday after burning through cash reserves on its Ocean SUV line in the U.S. and Canada.
Henrik Fisker is out of gas, again.
The automotive designer's California-based electric vehicle startup, Fisker, filed for bankruptcy protection late on Monday and will seek to sell its assets and restructure its debt after hemorrhaging cash on its "Ocean" SUV line in the U.S. and Canada.
The company joins other would-be Tesla competitors such as Proterra, Lordstown and Electric Last Mile Solutions, which each went bankrupt in the past two years after depleting cash reserves, fundraising hurdles and production challenges related to global supply-chain issues stemming from the COVID-19 pandemic. Fisker vehicles were also under investigation by U.S. regulators.
"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.
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"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."
The company said it is in advanced discussions with financial stakeholders for debtor-in-possession financing, but did not give further details.
Fisker in March had slashed prices for its fleet of Ocean electric SUVs in the U.S. in an effort to stave off bankruptcy.
Fisker said in a statement at the time that it was "strategically positioning the all-electric Ocean SUV to be a more affordable and compelling EV choice, competitively available to EV buyers in the broadest possible market, and constantly improving via frequent Over-the-air (OTA) software updates."
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Still, the price cuts came days after the New York Stock Exchange announced that it would delist Fisker's shares, saying that the "stock is no longer suitable for listing based on abnormally low price levels."
According to a filing with the Securities and Exchange Commission (SEC), an unnamed automaker that had been in talks to make a deal with Fisker had terminated negotiations on March 22. Reuters reported the company was Japanese automaker Nissan. After the deal fell through, Fisker began exploring options, including in- or out-of-court restructurings and capital markets transactions.
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Fisker paused manufacturing as well as investments in future projects until it secured an auto partnership and said it would cut its workforce by about 15%.
Backed into a corner, the company's operating unit, Fisker Group Inc., filed for Chapter 11 bankruptcy in Delaware, listing estimated assets of $500 million to $1 billion and liabilities of $100 million to $500 million. It has about 200 to 999 creditors, per the court filing.
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Fisker made over 10,000 vehicles in 2023, less than a quarter of its forecast, but delivered only about 4,700. Its cars are under regulatory investigation for certain incidents, including a probe started by the National Highway Traffic Safety Administration last month.
Fisker is the second auto startup from CEO Henrik Fisker to fail. Fisker Automotive filed for bankruptcy in 2013.
FOX Business' Daniella Genovese and Reuters contributed to this report.