Tesla Rival Electric Vehicle Maker Fisker Files for Bankruptcy Following Failed Investment Talks

As the firm suffers from the impact of a rapid capital burn to launch its Ocean SUV in the US and Europe, electric vehicle (EV) producer Fisker filed for bankruptcy after deal talks with a major carmaker collapsed. Fisker Group Inc. disclosed estimated assets of USD 500 million to USD 1 billion and estimated liabilities of USD 100 million to USD 500 million in its Chapter 11 bankruptcy filing in Delaware. According to the court filing, Fisker is believed to have 200–999 creditors. The company stated that it is also in advanced discussions about debtor-in-possession financing with financial stakeholders.

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Fisker Files for Bankruptcy: Key Details

Fisker began looking for strategic options, such as in-court or out-of-court restructurings and capital markets deals, after talks with a major automaker ended in March. Henrik Fisker, the founder of the U.S. company, had concerns in February about the company's viability and had put off investing in further projects until it had an auto alliance.

In addition, Fisker announced that it would reduce its personnel by roughly 15 per cent owing to the difficulties in selling its Ocean EVs. Less than 25 per cent of the initial projection was met with the production of over 10,000 vehicles in 2023, of which only roughly 4,700 were delivered. To make matters worse for the company, the National Highway Traffic Safety Administration (NHTSA) was already looking at three previous incidents involving the Ocean EVs manufactured by Fisker in 2023 when the U.S. auto safety authority launched a preliminary investigation into them last month.

This latest development with the bankruptcy of several other EV manufacturers in the last two years, including Proterra, Lordstown, and Electric Last Mile Solutions, as a result of declining cash reserves, difficulties obtaining capital, and challenges in scaling up production.

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Fisker Ocean

Globally, the manufacturer offered the Ocean EV in three trim levels: Sport, Ultra, and Extreme. The base Sport trim is said to have an estimated range of 372 kilometres (WLTP test cycle); the Ultra trim has a range of 563 kilometres (WLTP); and the Extreme promises 580 kilometres of range (WLTP). The electric SUV was made available in both two-wheel and all-wheel drive configurations. The Ocean EV was even spied testing in India last year.