Late last night (Monday), carmaker Fisker filed for bankruptcy protection. The company, maker of the Ocean electric SUV, is seeking to save itself by selling off assets and restructuring its debt. The filing comes after Fisker used up the last of its capital to try to speed up production of the Ocean.
The news comes as no surprise. At the turn of the year, we learned that Fisker was in discussions with a carmaker concerning a partnership. Those discussions never led anywhere, and since then, the news has gone from bad to worse.
Competition is fierce in the electric vehicle market, and the investments required to gain a foothold in it are massive. Fisker is not the first fledgling company to fall by the wayside. Case in point, Lordstown and its Endurance van.
For Fisker, this is a second bankruptcy. Fisker Automotive, maker of the exotic Karma, was forced out of business in 2013, a victim of the 2008 financial crisis, but also due to problems with the Karma's hybrid battery, which led to a major recall.
As reported by Reuters, Henrik Fisker declared, at the time of the IPO for the new venture, that Fisker wanted to become the Apple of the automotive industry by outsourcing the manufacture of its vehicles. The “asset light” business model was intended to reduce vehicle development times and time-to-market costs.
In the event, the Ocean SUV experienced software and manufacturing problems from the outset. Consumer Reports described the model as a work in progress, which said a lot. The Ocean is also under regulatory investigation over reports of problems with braking, and the vehicle shifting into Park mode and its doors opening at odd times, among other issues.
After delivering fewer than half of the 10,000 vehicles it produced last year, Fisker turned to a dealer-based distribution model in January, abandoning the direct-to-consumer approach. The company signed agreements with 15 dealers in the U.S. and 12 partners in Europe, but it still hasn't been able to sell its stock of over 5,000 units.
