Electric vehicles are being hailed as the future of the automotive industry.
But the brutal reality is setting in for many of their manufacturers about the business.
And Joe Biden was stunned that this former electric vehicle darling is on the verge of bankruptcy.
Every startup electric vehicle company is trying to become the next Tesla.
Tesla is the industry leader under the stewardship of its founder Elon Musk and has become a Wall Street darling because of its success.
But electric automakers trying to follow in its footsteps are finding that the path to success is more difficult than they ever imagined.
Fisker is on the verge of bankruptcy
Fisker was hailed as one of the darlings of the electric vehicle industry after it was launched in 2016.
The electric automaker was hailed by some Wall Street analysts as having the potential to become the next Tesla.
Now, Fisker is on the verge of going bankrupt and hopes of having a major automaker save the company have fallen apart.
The company was delisted from the New York Stock Exchange after shares of its stock plummeted after news broke that no major automaker would come to its rescue with an investment.
Shares of its stock collapsed by 95% from the beginning of the year to less than 10 cents when it was delisted.
Talks with a major automaker – reportedly Nissan – to save the company with an investment fell apart leaving Fisker teetering on the brink of bankruptcy.
And to make matters worse, production of its vehicles was halted because of an investigation by the U.S. National Highway Traffic Safety Administration’s Office of Defects.
The Fisker Ocean – the company’s flagship vehicle – is being investigated over reports that they randomly move without a driver’s control.
Now the company has $121 million in cash and cash equivalents with accounts payable at more than $180 million.
Fisker is running out of money to cover its bills and its sales are collapsing after production shut down over a potential safety issue.
The company’s CEO, Henrik Fisker, tried to put on a brave face amid his company’s growing struggles.
“We have a future—otherwise I wouldn’t be here,” Fisker told Yahoo Finance. “And I believe we’re gonna manage to get out of this, I would say, general EV slump that there is out there.”
Electric vehicle slump hammers Fisker
Companies rushed to get into the electric vehicle industry because of generous government incentives and rebates for buyers.
But sales across the industry have slumped because no one outside hobbyists and environmentalists wants to buy these expensive and impractical vehicles.
Fisker made more than 10,000 vehicles in 2023 but was only able to sell less than 5,000 nationally.
Now with the company facing bankruptcy, prices for its Ocean SUV were slashed from $61,499 to $37,499.
Fisker is on its way to being another casualty of the electric vehicle industry.
