It has happened at last. Electric vehicle maker Fisker (OTC:FSRN) has filed for bankruptcy after a series of setbacks. The company is in talks with financial stakeholders regarding debtor-in-possession financing and the sale of its assets.
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The Buildup to Fisker’s Bankruptcy
Fisker’s bankruptcy filing comes only days after the company issued a recall for nearly 18,000 vehicles. Last month, it had secured a $3.5 million lifeline from an existing investor by offering senior secured debt. Earlier this year, Fisker’s discussions for a potential deal with a major automaker fell apart. As a result, the company’s shares were delisted from the NYSE due to low stock price levels.
Fisker’s Chapter 11 move comes within just a year of the company’s introduction of its first EV model. While Fisker bet big on its Ocean SUV, a challenging macro environment and higher interest rates dented demand for EVs across the globe. Top global automakers with deep pockets have survived the industry downturn by slashing prices, lowering costs, and introducing cheaper models. Fisker, on the other hand, struggled as its cash reserves dwindled.
Henrik Fisker’s Second EV Failure
For CEO and Founder Henrik Fisker, the company’s bankruptcy marks the failure of his second automotive venture. Over the past few years, multiple EV makers, including Lordstown, Electric Last Mile Solutions, and Proterra, have gone bankrupt. Meanwhile, Henrik Fisker has also put his Los Angeles house up for sale for around $35 million. In comparison, FSRN’s market capitalization last stood at $69.8 million.
How Much Is Fisker Stock?
Amid Fisker’s plunging fortunes, its share price has tanked by nearly 99.3% over the past year. FSRN stock is currently changing hands at $0.05 apiece.
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