Electric-vehicle start-up Fisker Inc. has filed for bankruptcy in Delaware. It’s one of many companies in the sector to have done so in the past year.
The company has listed between $500 million and $1 billion of assets, and between $100 million and $500 million of liabilities, in its Chapter 11 filing, which will protect it from creditors as leaders work out a way to repay them.
“We are proud of our achievements, and we have put thousands of Fisker Ocean SUVs in customers’ hands in both North American and Europe,” a Fisker spokesperson said in a statement. “But like other companies in the electric vehicle industry, we have faced various market and macroeconomic headwinds that have impacted our ability to operate efficiently. After evaluating all options for our business, we determined that proceeding with a sale of our assets under Chapter 11 is the most viable path forward for the company.”
The company’s only vehicle, the Ocean SUV, has been troubled since its first deliveries: The National Highway Traffic Safety Administration opened four separate investigations after multiple reports of braking issues and door latch problems. Last week, Fisker also issued a recall due to a software bug that caused some of its vehicles to suddenly lose power and shut off.
Earlier this year, executives paused production of the vehicle as well as development plans for future models as they scrambled to lower costs but also raised doubts about the company’s ability to stay in business. The cost-cutting measures came in the form of layoffs, an emergency fundraising round and attempts to find a large manufacturing partner.
While the company was able to initially secure a $150 million financing commitment from one of its investors, its manufacturing deal reportedly fell through and executives subsequently retained restructuring and financial advisors as well as a law firm. At the time, CEO Henrik Fisker dismissed bankruptcy chatter as “market rumors.”
The company also attempted to shift dealer strategies to save money, which CFO Geeta Gupta-Fisker indicated would be critical to future success. Originally, Fisker had a direct sales approach, but pivoted to dealer partners with a focus on family-owned businesses.
In April, Fisker stock was delisted from the NYSE. At the time, its price was hovering around $0.09 per share. Last September, the shares had traded at nearly $7 each.
