Fisker files for insolvency in the USA

Fisker was once seen as a potential challenger to Tesla, however, the company by Danish car designer Henrik Fisker never reached a comparative size and fell far short of (its own) expectations in terms of unit sales. And it had been struggling for a long time: the company’s great hope, the Ocean electric SUV, was launched significantly late, partly due to problems with suppliers. For some time, Fisker has only really been big in the headlines.

But even with the start of deliveries, the tide has not turned: Some of the first customers and trade journalists also criticised software errors and technical problems. Batteries lost their charge quickly, doors could not be opened, sensors were faulty – and at high speeds, the bonnet sometimes even opened. In the important phase, when money was already scarce and investors were being sought, there was even more bad PR: the influential US Youtuber Marques Brownlee came to the devastating conclusion that the Ocean was “the worst car I’ve ever reviewed”.

Fisker also had a hard time with sales: Fisker declared that the original direct sales in the USA and Europe had largely failed and had been trying to get out of its bad situation with a dealer model since January.

In February, Fisker itself issued a warning about the continued existence of its own company – for US-listed companies, this is a mandatory announcement if the company’s cash reserves are not sufficient to finance business operations for a year. Therefore, such a warning does not necessarily result in insolvency, as there is still time to achieve a financial turnaround or find investors.

Fisker had reported talks with a “major car manufacturer” regarding a financial investment and a production cooperation for electric pickups – reportedly Nissan. However, the talks did not lead to any results or a cash injection for Fisker.

In mid-March, it was announced that production of the currently only Fisker model, the Ocean, had been interrupted. Production at contract manufacturer Magna in Graz was officially to be suspended for six weeks “to reduce stocks”. The production break was later extended until the end of June and the Austrian subsidiary had already gone bankrupt.

Now the main company in the USA is insolvent. According to the company, the Fisker Group, the operating subsidiary of Fisker Inc., has filed for Chapter 11 bankruptcy protection in Delaware. “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 statement reads.

Assets of around 500 million to one billion dollars are to be offset by liabilities of between 100 million and 500 million dollars. Fisker had already owed interest on convertible bonds in the spring, but then emphasised that there was enough money and that the step had been used for negotiations with investors. In fact, the cash had melted away considerably.

Update 04 September 2024

Troubled electric vehicle maker Fisker has reached a settlement with creditors that will allow it to liquidate its assets while working with owners to keep their electric SUVs on the road. After Fisker filed for Chapter 11 bankruptcy protection in June, the company recently reached an agreement in U.S. Bankruptcy Court in Delaware allowing Fisker management to remain in charge for some time as the operation winds down.

“The owners strongly believe that Fisker owes them a responsibility to ensure that their vehicles are safe and operable, and that the best way for Fisker to fulfill that promise is through a Chapter 11 process,” said attorney Daniel Shamah, who represents the Fisker Owners Association. “We can be sure that employees and the advisors who are helping the company do this remain on board.”

 businesswire.com, reuters.com, latimes.com (update)