EV maker Fisker says it could run out of cash needed to survive

New York (CNN) — Fisker, the electric vehicle company founded by auto designer Henrik Fisker, announced in its fourth quarter earnings Thursday that it might not have enough money to survive another year.

The company announced there was “substantial doubt about Fisker’s ability to continue as a going concern.” In order to have the cash to do business through the next 12 months, the company will have to raise more money from investors. Fisker’s stock was trading at 75 cents a share at the close of trading Thursday and dropped to a little more than 40 cents this morning.

The company is in discussions with an existing investor about possibly putting more money into the company, the EV maker said in its announcement. It will also lay off 15% of its workforce as it attempts to cut costs.

Fisker lost $463.6 million while taking in $200 million in revenue in the 4th quarter of 2023. That included a $325 million adjustment related to convertible notes. The company’s loss from operations was $103.5 million.

Fisker, which sells the Ocean electric SUV, has an unusual business model in which it has entirely outsourced the manufacturing of the one model it currently sells. The Ocean is built in Austria by Magna, a company that has also built vehicles for Mercedes-Benz, BMW and Jaguar.

“2023 was a challenging year for Fisker including delays with suppliers and other issues that prevented us from delivering the Ocean SUV as quickly as we had expected,” founder and chief executive Henrik said in an announcement.

Last year, Magna produced more than 10,193 Fisker SUVs, but fewer than half of those were delivered to customers within the calendar year, the company announced. Fisker expects to deliver about 20,000 this year, it added.

Fisker did not file an official form 10-K, its full annual report, for 2023 because, it said, it needed more time to finalize the report and that it will be filed by March 15. The company said it had found ”a material weakness in revenue and the related balance sheet accounts,” which will be disclosed in the 10-K report.

Fisker’s original business plan featured direct sales to customers without an independent dealer in the middle, much like Tesla. Fisker changed that strategy this year, however, and has begun signing up franchised dealers. So far, the company has signed up 12 dealers in the US and Europe, Fisker recently announced.

Fisker is founder Henrik Fisker’s second car company. His first, Fisker Automotive, produced a plug-in hybrid luxury car called the Fisker Karma. That company went bankrupt in 2013 after much of its inventory was wiped out by Hurricane Sandy.

This story’s headline has been updated to clarify Fisker’s operational future.

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