Success may not be a straight line, but every now and then, it has to come up for air.
The electric vehicle sector has been going through some difficulties lately as sales have slowed and companies cut back on production plans.
This situation is particularly tough for EV startups, such as Lordstown Motors, which filed for Chapter 11 bankruptcy in July 2023 to restructure and sell its assets.
The debtor won confirmation of its Chapter 11 plan on March 5 and was ready to emerge from bankruptcy.
Fisker (FSR) is another EV company that has been forced to make some hard decisions, including, most recently, pausing production of its vehicles for six weeks beginning March 18.
Shares finished down 15.6% on Monday to 14 cents.
The Manhattan Beach, Calif.-based company, founded in 2007 by Henrik Fisker, a Danish automotive designer and entrepreneur, said in a March 1 filing with the Securities and Exchange Commission Form that it would be late in filing its 10-K annual report for the year ending Dec. 31, 2023.
CFO: 'Substantial doubt'
Fisker said it had undergone a change in key accounting personnel and needed more professionals with accounting knowledge, training, and experience to complete the report, which was due on Feb. 29.
Florus Beuting, who was named chief accounting officer in early November, left the automaker a short time later.
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His exit followed the departure of John C. Finnucan IV, who left in late October after about three years at the company to take a job with another company. Angel Salinas took over the position in early January.
Fisker said it had identified material weaknesses in revenue and related balance sheet accounts and expected capital expenditures and working capital requirements to decrease in 2024 and beyond as it enters the second year of production of the Fisker Ocean.
The company recently reported a fourth-quarter loss of $1.23 per share, far beyond the FactSet consensus of a 22-cent loss and the year-ago loss of 54 cents a share.
Revenue totaled $200.1 million, short of FactSet’s call for $327.7 million and below the year-ago tally of $306 million.
Chief Financial Officer Geeta Gupta-Fisker told analysts, "There is substantial doubt about our ability to continue the going concern when we file our 10-K with the SEC."
She added, "2023 was a much more challenging year than we anticipated."
"However, I can assure you that everyone at Fisker is working extremely hard around the clock," Gupta-Fisker said, according to a transcript of the call.
CEO: 'We are in this for the long haul'
The EV maker said it was cutting about 15% of its workforce as it shifts to its Dealer Partner model in 2024.
Gupta-Fisker acknowledged that the company’s business plan is highly dependent on the successful transition and execution from selling directly to customers to a new Dealer-Partner model.
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"We recognize that success is not a straight line," CEO Henrik Fisker told analysts. "We are bringing to the world the most sustainable electric vehicle. We knew this would be difficult, but we are in this for the long haul and are confident in our direction."
Fisker added that the company believes the Ocean platform is competitively priced and has several class-leading features, including a best-in-class range of 360 miles, "while we also realize that the EV industry is going through a turbulent and unpredictable period."
In addition to pausing production, Fisker announced that it had secured a financing commitment from an existing investor of “up to $150 million.”
The company also confirmed it is in negotiations with “a large automaker” for investment in the company, joint development of one or more electric vehicle platforms, and North American manufacturing.
The company in question is Nissan, according to Reuters, which said the deal could provide the Japanese automaker with access to an electric pickup truck while giving the struggling startup a financial lifeline.
Terms being discussed include Nissan investing more than $400 million in Fisker's truck platform and building Fisker's planned Alaska pickup starting in 2026 at one of its U.S. assembly plants, Reuters said, citing an unnamed source.
Nissan would build its own electric pickup on the same platform, the source said. Nissan has U.S. assembly plants in Mississippi and Tennessee.
A Fisker spokesman said the company does not comment on speculation.
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