Fisker’s latest setback is an 18K-vehicle recall as EV startups get pummeled

Outlook not so good… Fisker, the US EV startup flirting with bankruptcy, has hit another pothole: 11K Ocean SUVs (Fisker’s only model in production) have a software malfunction that could lead to a loss of motor power. Now it’s recalling 18K SUVs for over-the-air updates. The once buzzy automaker was valued at $8B just a few years ago but has since plummeted to a market cap of about $25M — less than the price of its founder’s Hollywood mansion. In March, Fisker said it could go under soon, and a month later it was delisted from the NYSE. Some of the problems that have analysts on a “death watch”:

• A rough start: US deliveries started about a year ago, but Fisker was accused of fixing customer cars with parts stripped from executives’ personal vehicles. Fisker denied that. The company’s delivered just ~7K SUVs to date.

• Lotta probes: US regulators have opened four investigations into the Ocean SUV this year. One is looking into reports that its doors sometimes don’t open. Another centers on complaints of its emergency braking system activating without warning.

EVs ain’t EZ… When Fisker went public in 2020, investors were looking to get in on the ground floor of the next Tesla. But the EVironment has shifted: at least 30 EV companies have shut down or faced bankruptcy in the past decade, including Lordstown Motors, Arrival, and Protera. In February, Apple junked its EV ambitions, and Rivian and Lucid offered disappointing production outlooks. It’s not just startups: Tesla’s sales have declined 13% YoY, and its unsold inventory is piling up.