EV startup Fisker slides as cash dwindles with 'difficult year' ahead
01/03/2024 10:49
March 1 (Reuters) - Fisker shares FSR.N skid nearly
40% on Friday after the electric-vehicle startup flagged
going-concern risks, saying it would cut its workforce by 15%
and pause investments in future projects until it secures a
partnership with a manufacturer.
The company warned of a "difficult year" ahead, the latest
sign of growing pain in the EV sector after weak production
forecasts from Rivian RIVN.O and Lucid LCID.O .
Fisker, whose shares were down 38.9% at 44 cents in
premarket trading, has received a notice from the New York Stock
Exchange that it was not in compliance with a listing rule.
High interest rates, range anxiety while driving and high
repair costs are making consumers rethink EV purchases and
instead opt for hybrids.
Fisker expects to make between 20,000 and 22,000 Ocean
vehicles in 2024, below estimates of 35,600, according to
Visible Alpha.
The company ended 2023 with cash and cash equivalents of
$325.5 million, down from $527.4 million as of Sept. 30, after
its net loss more than doubled in the fourth quarter to $462.6
million.
Fisker also said it needs more cash over the next 12 months,
despite a "higher-than-usual" cash injection in the first half
of 2024 from late deliveries of its Ocean SUVs, which were
delayed due to logistics issues.
The company is trying to pivot to a dealer-partner model
from a direct-to-customer model, in a shift from the strategy
followed by EV peers.
"Fisker's survival is likely contingent on its ability to
execute a deal," TD Cowen analyst Jeffrey Osborne said.
CEO Henrik Fisker said the company was not planning to start
"external expenditure" on future projects, the Alaska pickup
truck and PEAR compact car, unless it secures another
manufacturing partner.
"Fisker is in negotiations with a large automaker for a
potential transaction which could include an investment in
Fisker, joint development of one or more electric vehicle
platforms, and North America manufacturing," he added.
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Fisker's cash balance depletes as it ramps up EV deliveries https://reut.rs/49FvWBC
Fisker's shares vastly underperform EV peers https://reut.rs/49UrZIJ
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(Reporting by Akash Sriram in Bengaluru; Editing by Devika
Syamnath)
((Akash.Sriram@thomsonreuters.com; On X as @HoodieOnVeshti;
+91-74116-87774;))