Fisker Files for Bankruptcy. How the EV Maker Fizzled Out.
Fisker
,
an electric vehicle start-up that attempted to follow in
Tesla
’s
footsteps, filed for bankruptcy.
The seven-year-old company released its first EV, the Ocean SUV, about a year ago. It becomes the latest battery-powered car start-up to seek protection from creditors, following Lordstown Motors and Arrival as the start-up EV stock bubble bursts.
Founder Henrik Fisker successfully raised more than $1 billion from investors, but building a car company costs a lot more than that.
Tesla used more than $9 billion in cash before it started generating consistent profits and cash flow in 2019. Tesla shipped about 368,000 vehicles that year. Scale matters, a lot, in the car business. Car makers typically need to ship hundreds of thousands of vehicles annually to break even.
Fisker never achieved that scale. Before running short of cash and pausing production, the company targeted 2024 shipments of about 21,000 cars. It delivered roughly 5,000 vehicles in 2023.
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Fisker didn’t immediately respond to a request for comment about any next steps following its bankruptcy filing.
Fisker stock has lost almost all its value over the past 12 months. Shares have fallen 59% to $0.0186 after dropping 2% on Monday to close at $0.0451. It briefly traded above $30 in 2021.
Auto parts supplier
built the Fisker Ocean EV at its plant in Austria. Magna took a $316 million asset write-down in the first quarter related to Fisker.
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Magna didn’t immediately return a request for comment about any next steps or write-downs related to Fisker’s bankruptcy filing.
Magna stock was unchanged in premarket trading Tuesday, while
and
futures were flat and up 0.1%, respectively.
Coming into Tuesday’s trading, Magna stock was down about 27% year to date. Most of that has to do with investor sentiment about the car business. Most North American car stocks are down year to date as investors worry about the health of the U.S. consumer, cost inflation, and falling car prices.
Write to Brian Swint at brian.swint@barrons.com and Al Root at allen.root@dowjones.com
