Fisker is facing severe financial difficulties as it announces further layoffs and the potential for bankruptcy within the next month unless it secures additional funding. This development follows the recent reduction of 15% of its workforce.
The company, struggling to raise funds to avoid bankruptcy, revealed in a U.S. Securities and Exchange Commission (SEC) filing that it holds only $54 million in cash and equivalents and an inaccessible $11.2 million. With a defaulted loan of over $300 million, Fisker is in dire financial straits despite recent efforts to streamline operations by reducing its physical footprint and staff, which now numbers 1,135 globally.
The company’s troubles have been compounded by the problematic launch of the Fisker Ocean SUV in June 2023. Technical issues, including buggy software and significant mechanical failures, have plagued the vehicle, resulting in numerous customer complaints and three federal investigations by the National Highway Traffic Safety Administration.
Despite these challenges, no recalls have been issued; however, Fisker has paused production and heavily discounted remaining inventory to boost short-term cash flow. Additionally, the company has appointed a chief restructuring officer, who is now responsible for approving the company’s budget and overseeing decisions related to any potential sale of the business.
This series of setbacks is not a first for Henrik Fisker, the company’s founder, whose previous venture, Fisker Automotive also filed for Chapter 11 bankruptcy protection in 2013.
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