Car Manufacturer Fisker Temporarily Stops Operations, Seeks Financial Recovery, and Aims for Support from Original Equipment Manufacturers (OEM)
Fisker Inc., the California-based electric vehicle (EV) manufacturer, has announced a six-week production pause starting from the week of March 18, 2024. This decision aims to align inventory levels and progress strategic and financing initiatives.
In the same timeframe, Fisker has delivered approximately 1,300 vehicles globally, and produced around 1,000 vehicles in 2024 through March 15. The company currently holds approximately 4,700 vehicles in its inventory, including 2024 production. The completed vehicle value for this inventory is believed to exceed $200 million.
Despite the production pause, Fisker's plans to deliver 25,000 vehicles in 2024 remain unchanged. This announcement comes after the company surpassed Toyota in US registrations in January, with 640 registrations, ranking 13th among brands selling electric vehicles in the US, according to S&P Mobility data.
In a move to further strengthen its financial position, Fisker has secured a financing commitment of up to $150 million from an existing investor. This financing is structured in four tranches and is subject to certain conditions, including the filing of Fisker's 2023 Form 10-K.
Fisker is also in negotiations with a large automaker for a potential transaction that could involve an investment, joint development of EV platforms, and North America manufacturing. The production pause does not affect these negotiations.
It's worth noting that Fisker has not completed a Net Realizable Value (NRV) analysis for 2024. However, the company has received a financing commitment of up to $150 million from Deutsche Bank to the holder of Fisker's convertible bonds maturing in 2025.
Fisker Inc. (NYSE: FSR) has filed a Form 8-K with the US Securities and Exchange Commission, providing additional disclosures regarding these developments. The filing details the news contained in this press release.
In conclusion, Fisker's production pause is a strategic move aimed at aligning inventory levels and advancing its financial and strategic initiatives. The company remains committed to its goal of delivering 25,000 vehicles in 2024 and is actively engaged in negotiations with a large automaker for a potential transaction.
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