History repeats itself: electric car brand Fisker is in distress

Henrik Fisker, a famous automobile designer who has worked for brands such as BMW, Aston Martin and Tesla, has set himself the difficult task of competing with the latter in the high-end electric car segment. In 2007, he launched the manufacturer Fisker Automotive, which produced a single vehicle from 2011 to 2012, the large electric sedan with a range extender Fisker Karma.

Despite major arguments such as a captivating design and a commendable quest for eco-design, the Karma fell short on crucial points such as habitability and trunk volume. Above all, the experience experienced by many customers was nothing short of catastrophic, with repeated malfunctions, particularly electronic ones.

The adventure finally ended for Henrik Fisker with the bankruptcy of Fisker Automotive, whose assets were bought by the Chinese Wanxiang Group in 2014. Via the Karma Automotive brand, the group has since tried to make profound changes to the Karma to finally make her attractive, somehow.

Same mistakes, same fate?

But Henrik Fisker had not said his last word, and in 2016 again launched an automobile manufacturer called Fisker Inc. This time, he wanted to attack the Tesla Model Y with a 100% electric SUV for the general public, comprising numerous specific features allowing it to stand out.

However, it seems that Henrik Fisker has not learned from his mistakes. Thus, in seeking to respect the announced deadlines at all costs, the release of the Ocean SUV seems to have been somewhat rushed. Despite turbulence which destabilized the automobile industry as a whole, Fisker finally managed to deliver its first Ocean “only” six months late.

The Ocean certainly contains many good ideas, but Henrik Fisker has once again neglected the importance of delivering cars with successful development to his first customers. Early examples of the Ocean had numerous software issues, to the point where adaptive cruise control was, for example, absent and only promised via a future over-the-air (OTA) update.

Due to the setbacks reported by the press, the YouTuber MKBHD, or even the Consumer Reports association, very influential across the Atlantic, and crisis communication which lacked transparency, the Fisker share price plummeted and production of the Ocean in Austria was suspended in mid-March.

If there remained a glimmer of hope linked to Nissan’s supposed desire to invest in the brand, it was extinguished with the announcement by Fisker of the abandonment of negotiations with a “major car manufacturer”.

At its IPO in 2020, Fisker Inc. was worth $2.9 billion, but its market cap just fell below $50 million. The manufacturer’s stock was even delisted from the New York Stock Exchange on Monday March 25, 2024.

Fisker is therefore urgently looking for new investors and urges us not to talk about bankruptcy too quickly. Despite everything, this prospect seems more and more likely. “I can’t say if it’s next week or next year, but it’s inevitable”estimates Thomas Hayes, president of the investment fund Great Hill Capital, cited by Automotive News.

Real electric car startups, those not launched by Chinese giants, don’t have it easy. Despite the enthusiasm of financial markets to seek out the new Tesla, their support often dries up as soon as (almost inevitable) setbacks in moving from concept to mass production occur. Tesla had been there, even Bill Gates having bet against Elon Musk; However, the manufacturer finally got its head above water. Not sure if the same is true for Fisker and his Ocean.