California-based Fisker Inc. on Monday filed for bankruptcy protection, joining the long list of EV makers to bite the dust including Arrival SA and Lordstown Motors.
What Happened: Fisker filed for Chapter 11 bankruptcy and listed estimated assets in the range of $500 million to $1 billion and liabilities in the $100 million to $500 million range.
California-based Fisker warned in February that it may not have enough funds to operate over the year. The company’s shares were delisted from the New York Stock Exchange the following month owing to low share prices and potential investment talks with a major automaker collapsed, leaving Fisker's financial future uncertain.
In April, the company said in a filing that it expects to seek protection under bankruptcy laws within 30 days if unable to receive waivers from its debt holders or raise enough capital to settle its dues. The company had unrestricted cash and cash equivalent of just $53.9 million as of April 16.
Elon Musk Reacts: “The default state of a car company is dead,” rival EV maker Tesla Inc‘s CEO Elon Musk said about Fisker’s bankruptcy filing.
Musk has previously lauded his own company Tesla and Ford Motor Co as the sole two American carmakers not to have gone bankrupt out of the thousands operating in the auto industry.
In 2022, the billionaire also predicted impending bankruptcy for EV startups Rivian Automotive and Lucid Motors. Although both companies have been accumulating losses for every vehicle delivered, they continue to survive.
Why It Matters: The Ocean SUV is the only Fisker vehicle in production. Despite producing around 10,200 Ocean SUVs in 2023, Fisker only managed to deliver 4,929 vehicles during the year.
To aggravate the company’s hardships, U.S. auto safety regulator National Highway Traffic Safety Administration (NHTSA) opened two back-to-back probes into Ocean SUVs in April and May, one over concerns of unintended activation of its automatic emergency braking system and the other over complaints of faulty doors.
Last week, U.K.-based Arrival SA announced that it had been declared bankrupt, sharing the same fate as Lordstown, Proterra, and Volta Trucks amid high production costs and a lack of access to capital. Fisker is the latest addition to the list.
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Read More: Tesla Cuts Prices On Select Variants Of Model 3 In Canada
Photo courtesy: Fisker
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