Electric vehicle startup Fisker filed for Chapter 11 bankruptcy in a Delaware federal court on Monday evening, intending to sell its assets. This decision comes after recently halting production of its "Ocean" SUVs.
Joining the ranks of Arrival, Lordstown Motors, Proterra, and Electric Last Mile Solutions, Fisker's bankruptcy underscores the severe challenges faced by EV startups over the last several years. These challenges include depleted cash reserves, a high interest rate environment, and a downturn in EV sales, particularly in the face of Tesla's EV price war worldwide.
The startup, founded by former BMW and Aston Martin designer Henrik Fisker, whose EV company previously went bankrupt, released this statement:
"Like other companies in the electric vehicle industry, we have faced various market and macroeconomic headwinds that have impacted our ability to operate efficiently.
"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."
Per the court filing, Fisker estimated assets to be $500 million to $1 billion and liabilities to be $100 million to $500 million. It noted there are approximately 200-999 creditors.
The announcement comes as no surprise. In February, Fisker issued a "going concern" warning about running out of cash in the second half of the year. In March, the company reportedly hired bankruptcy consultants and more recently missed a loan payment. There was speculation that a "large automaker" was interested in making an investment, but nothing came out of that.
In 2023, Fisker produced over 10,000 Oceans, less than a quarter of its forecast, but only delivered 4,700. Manufacturing of the SUV is currently paused as Fisker's future remains uncertain.
Earlier this year, Adam Jonas at Morgan Stanley called for a consolidation wave in the EV space. Tesla is the strongest EV company standing.
