Magna Reports Earnings, Outlook Assumes “No Further Production of Fisker Ocean”
Written by Cláudio Afonso | Info@claudio-afonso.com | LinkedIn | X
Magna reported on Friday its first quarter financial results disclosing a 3 percent increase in sales to $11 billion and $316 million in asset impairments and restructuring linked to Fisker.
The EV startup signed a long-term binding manufacturing agreement with Magna in 2021 announcing that the production of its first model Ocean would start in November 2022. The signing followed the cooperation agreement originally entered in October 2020.
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Magna expects its total sales in 2024 to range between $42.6 – $44.2 billion decreasing from the previous estimate of $43.8 – $45.4 billion. In a side note of its updated 2024 outlook, Magna said its updated outlook “assumes no further production of the Fisker Ocean”.
At its plant in Austria, Magna has produced more than 4 million vehicles for several global automakers. Fisker’s agreement with Magna had planned the production of up to 120,000 units a year.
In late April, Magna notified its workforce in Graz that it would reduce around 500 positions. The decision followed a prior adjustment in December when Magna reduced from a double-shift to a single-shift operation.
In an email sent to all customers in Europe, Fisker informed on Friday that would discontinue its roadside assistance from the fourth of May onwards. The company encouraged owners to “explore the coverage options through the auto insurance provider and/or auto club membership”.
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Fisker has reportedly closed its showroom in New York this week as it transitions from direct sales to a dealer partnership model.
Located at 401 W. 14th Street, the Fisker store had been showcasing two units of its Ocean SUV until Thursday, which were removed on Friday — according to a Reddit User.
Earlier this week, Fisker announced the addition of six dealer partners in the US bringing the number up to 12 as it continues to switch to dealer partnership model.
In mid-April, Fisker had announced new dealer partners in the U.S. and Europe having. As of today, Fisker has dealer partners in six European countries including Denmark, Austria, France, Germany, Norway, and Switzerland.
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Business insider reported earlier this week that Fisker technicians have been using parts from pre-production vehicles and existing inventory to repair some customers’ cars.
Facing a backlog of customer service requests and a shortage of available parts, Fisker employees have reportedly removed parts from what some refer to as “donor cars” which include pre-production and production vehicles stored in La Palma, California.
In a recent SEC filing, the EV startup Fisker disclosed it missed an $8.4 million installment payment on March 29, violating its agreement with the investor triggering the right to demand immediate redemption of their investment to the company.
Fisker has recently withdrawn all financial and operational guidance for 2024 and appointed both Deutsche Bank and PJT Partners as financial advisors to explore strategic alternatives.
Written by Cláudio Afonso | Info@claudio-afonso.com | LinkedIn | X
