Fisker files for Chapter 11 bankruptcy – Ocean EV production suspended, asset sale planned

Fisker files for Chapter 11 bankruptcy – Ocean EV production suspended, asset sale planned

In what will come as a surprise to nobody that has been following its struggles, Fisker has filed for Chapter 11 bankruptcy in Delaware. The Californian carmaker, the second to be founded by designer Henrik Fisker (and the second to enter bankruptcy), said it is in “advanced discussions” with stakeholders over financing and the sale of assets.

The company added that production of its Ocean electric SUV, halted back in March for what was originally supposed to be a six-week period to clear inventory, will continue to be suspended. It will file motions to allow for “reduced operations”, such as paying wages and benefits, preserving certain customer programmes and compensating vendors.

“Like other companies in the electric vehicle industry, we have faced various market and macroeconomic headwinds that have impacted our ability to operate efficiently,” said a spokesperson. “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.”

Fisker files for Chapter 11 bankruptcy – Ocean EV production suspended, asset sale planned

Fisker has undergone a baptism of fire since it revealed the Ocean, its first production model, in early 2020 – right before the world was engulfed in the throes of the COVID-19 pandemic. Having already been beset by delays in the ensuing chaos, the car finally reached showrooms last year and was almost immediately hit with customer complaints over faulty hardware and software, Reuters reported.

Reviewers haven’t been kind to the Ocean, either – Consumer Reports earlier this year described the car as “unfinished”, with buggy software and features that disappeared and reappeared. This all culminated with the US National Highway Traffic Safety Administration (NHTSA) opening four separate investigations over loss of braking performance, vehicle rollaways, door opening failures and phantom braking from the autonomous emergency braking system.

To its credit, Fisker has released various software updates to fix some of the litany of issues, including a big v2.0 update in February, but by then the damage was done. And it didn’t stop the scrutiny from the NHTSA, leading to a voluntary software update “recall” to v2.1 to rectify problems with loss of power and malfunctioning warning lights (the irony) just last week.

Fisker files for Chapter 11 bankruptcy – Ocean EV production suspended, asset sale planned

Unsurprisingly, sales suffered as a result – Fisker made just over 10,000 units of the Ocean last year, but less than half of those were delivered. The company warned of insolvency throughout the year and said it was in talks with a carmaker – which Reuters revealed to be Nissan – to receive funding and co-develop an electric pick-up truck based on the then-forthcoming Alaska.

Those talks fell through, however, resulting in an investor pulling US$350 million (RM1.6 billion) in investment that was contingent on that partnership. This forced Fisker to explore other options, including bankruptcy. In its filing, Fisker estimated assets of up to US$1 billion (RM4.7 billion) and liabilities of up to US$500 million (RM2.4 billion).

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Jonathan Lee

After trying to pursue a career in product design, Jonathan Lee decided to make the sideways jump into the world of car journalism instead. He therefore appreciates the aesthetic appeal of a car, but for him, the driving experience is still second to none.

 

Comments

  • Yani Lingga from Riau on Jun 19, 2024 at 12:27 pm

    Thanks to a prominent YT bad review. There forget to give big angpow to Marques Brownlee. Lawsuit is redundant

    Like or Dislike: Thumb up 7 Thumb down 2
    • Pusing2 on Jun 19, 2024 at 5:41 pm

      Well, you fail to include the almost endless negative reviews from existing owners agreeing with Marques Brownlee that the Ocean is indeed a hot pile of garbage.

      Owners been complaining about multiple issues affecting their Oceans ranging from brakes problem to sudden power loss while on highway, an issue which comically was experienced first-hand by a Fisker exec.

      Like or Dislike: Thumb up 3 Thumb down 3
    • Mike Tee on Jun 20, 2024 at 10:49 am

      I chance upon a car crash and say “look at that car crash, it’s a bad wreck, nobody is going to survive” does not make me responsible for that crash

      Like or Dislike: Thumb up 0 Thumb down 0
  • Many China brands also still surviving. Why angmo so poor in doing business?

    Like or Dislike: Thumb up 1 Thumb down 1
    • Mike Tee on Jun 20, 2024 at 10:52 am

      I am the biggest supporter of Chinese EV but the western point of view is not just that Chinese carmakers are subsidised (because Fisker, Rivian, Tesla, etc all received subsidies) but that “laxer” labour laws in China throughout the supply line, from mining, to the delivery guy, to the factory floor and the lack of unions means that it’s not as simple as “get leaner, Fisker” for them to be competitive. Their cost base is already higher but compliance cost is a killer.

      Sucks to be them and I don’t know how they can compete with China to be honest.

      Like or Dislike: Thumb up 0 Thumb down 0
  • WHAT another USA EV maker hit the DUST on Jun 19, 2024 at 2:09 pm

    CHINA only need to use Little Finger already can beat the craps out of any USA EV

    CHINA numba ONE

    Like or Dislike: Thumb up 5 Thumb down 6
  • hazri on Jun 19, 2024 at 3:15 pm

    elokla tu bankrap. lampu belakang pun kedekut nak bagi proper sikit.

    Like or Dislike: Thumb up 5 Thumb down 0
  • James KWON on Jun 19, 2024 at 6:11 pm

    many people dont know that Fisker was actually made on China using Arcfox platform. arcfox down means Fisker down. Anything Fisker touch goes bankrupt.

    Like or Dislike: Thumb up 2 Thumb down 0
 

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