Fisker Announces Production Pause and Financing Commitment Amid Financial Challenges
Electric vehicle manufacturer Fisker Inc. has recently announced a six-week production pause starting March 18, 2024, to address inventory levels and pursue strategic and financing initiatives. The company has also secured a conditional financing commitment of up to $150 million from an existing investor, subject to certain conditions, including the filing of its 2023 Form 10-K.
Quality Issues Plague Fisker Ocean SUV
Since its launch, the Fisker Ocean SUV has been plagued by quality issues, with owners reporting sudden power losses, glitchy key fobs and sensors, hoods flying open, and brake problems. Even Fisker board member Wendy Greuel and CFO Geeta Gupta Fisker experienced power shutdowns while driving their Ocean SUVs.
In a recent test drive, a prominent automotive publication encountered numerous issues with an unfinished Ocean test car, including squeaky pedals, an inoperative California mode, and poor handling. The publication was unable to provide a rating for the EV due to the missing or “coming soon” features.
Fisker’s Troubled History
This is not the first time Fisker has faced challenges. Over a decade ago, the company’s founder, Henrik Fisker, launched the Fisker Karma, a range-extender sports GT that was ahead of its time but suffered from various problems, including a disastrous Consumer Reports test and fires.
Fisker states that it has approximately 4,700 vehicles in its inventory, carried over from 2023 and including 2024 production, and believes the completed vehicle value for this inventory is in excess of $200 million.
Financial Challenges and Uncertain Future
Fisker’s current financial situation appears bleak. The company reported $273 million in sales last year but is more than $1 billion in debt. In February, Fisker issued a warning about the “substantial doubt” regarding its ability to remain in business. The prolonged production pause further reinforces this uncertainty.
To date, Fisker has delivered 1,300 vehicles in 2024 and shipped 4,900 to customers in 2023. The company declined to provide additional details on the specific conditions required to secure the new investment.
As Fisker navigates these challenges, the future of the company and its electric vehicles remains uncertain. The production pause and conditional financing commitment may provide some temporary relief, but the company will need to address the underlying issues and demonstrate a clear path to profitability to regain investor and consumer confidence.
2 Comments
Guess Fisker hit a speed bump on the road to electric dreams, huh
Wow, electric car dramas never end, do they? Fisker’s hitting the brakes hard!