Fisker Could Go Bankrupt, Pear Prospects Bruised
Fisker says it doesn't have enough cash to make it through the year. But is salvation near?
The road for Henrik Fisker as an independent automaker might be coming to a close one ( again ). Fisker released its Q4 2023 earnings report recently, and to say the outlook is not great would be an understatement. The automaker has admitted that if it doesn't secure an investment partner soon, it will face dire financial straits.
Fisker revealed three EVs in August 2023, including the Pear crossover , Alaska truck, and the Ronin four door convertible GT. The Pear was given a release window of mid-2025 while the Ocean-based Alaska truck was given the ambitious target of December 2024. Fisker seemed bullish on his company's future, but in the earnings report he painted a very different picture about the past year.
"2023 was a challenging year for Fisker, including delays with suppliers and other issues that prevented us from delivering the Ocean SUV as quickly as we had expected," Fisker said. "We also encountered unexpected headwinds in our efforts to establish a direct-to-consumer sales model in both North America and Europe at the same time." Eventually Fisker decided to ditch the direct-to-consumer model and move to a "Dealer Partner" model instead that would offer no-haggle pricing, though that's still an ongoing process.
Fisker's Q4 2023 gross margin was -35 percent, and it lost $1.23 per share during that period. For the full year of 2023 Fisker produced just 10,193 Ocean SUVs, and of that only 4,929 were delivered, although it admittedly hasn't been on sale for very long. Fisker's marketing effort has been modest, so the Ocean was never in a position to be a serious threat to competitors like the Tesla Model Y in 2023.
Ultimately, it's all resulted in a troubling financial outlook for Fisker. Things are so bad that the automaker admitted that it has "substantial doubt about its ability to continue" after looking at its financial statements for year end of 2023. According to the earnings letter, to address the problem it is in talks with a "large automaker" to make an investment in Fisker and keep things going.
While Fisker himself is keeping mum on who the potential partner could be, a report from Automotive News says that Nissan is the automaker in question and that it could invest more than $400 million in Fisker's truck platform and sign on to build the Alaska pickup . According to the report, negotiations are still ongoing and nothing is solid yet. The earnings letter made it clear that if an investor doesn't come on board soon, Fisker may not be around much longer.
"Fisker's current resources are insufficient to satisfy its requirements over the next 12 months," the automaker stated in the letter. "The company will need to seek additional equity or debt financing, and there can be no assurance that Fisker will be successful in these efforts."
Even if Fisker finds an investment partner, it still plans to reduce its workforce by 15 percent, which is mostly related to its shift in sales strategy from direct-to-consumer to its dealer-partner model. It is likely that the job cuts may come from Fisker's internal consumer sales team. Furthermore, Fisker confirmed that the automaker is "not planning to start external expenditure on our next projects" until a OEM partnership is in place. That means the Fisker Pear is effectively delayed until another automaker comes in to help shoulder the cost of production.
This is a make-or-break moment for Fisker, and for now the future is fuzzy at best. Making cars is hard—and Henrik Fisker knows that better than anyone.
