EV Maker Fisker Files for Bankruptcy

In a sign that even companies in the growing EV market can fail, Fisker, a US-based electric vehicle startup, filed for bankruptcy on Tuesday. The announcement followed a series of financial and operational setbacks. 

The company had previously warned of its precarious financial state, indicating in its February earnings report that it might not have enough funds to continue operations beyond the year. Fisker had been negotiating with an investor to secure additional funding, but those efforts did not materialize into a lifeline.

The company has faced significant challenges, similar to those impacting the broader electric vehicle industry, such as fluctuating market conditions and macroeconomic pressures. These difficulties were compounded by the slow growth in global EV sales, which is projected to increase by 21% this year, a drop from the 35% rise seen in 2023, according to the International Energy Agency.

Fisker’s sole product, the Ocean Electric SUV, has been marred by quality issues and poor market reception. Despite producing approximately 10,000 units last year, only half were delivered to customers. Negative reviews further damaged the company’s reputation and stock value. The company’s poor software integration offerings drew the harshest criticism, an issue Fisker’sCEO Henrik Fisker attributed to mismatched software from different suppliers.

Competition in the electric SUV market has intensified, with established automakers like Tesla, Hyundai, Kia, Ford, and General Motors, as well as rising Chinese giant BYD, offering alternative models without the risks associated with a nascent startup. Fisker, founded in 2016, struggled to maintain a foothold amidst these industry heavyweights.