Sometimes, an incredibly lucrative deal might be too good to be true.
On June 18, Manhattan Beach, California-based EV startup Fisker, Inc. filed for Chapter 11 bankruptcy after a turbulent pattern of events that involved various quality control issues, recalls, and a disastrous review from YouTube's leading tech authority affected the firm's sole offering; the all-electric Ocean SUV.
With the company left working to find creative solutions to pay back its creditors, a landmark deal is set to outfit New York City-based rideshare drivers with new electric vehicles obtained at prices at a fraction of its MSRP. But like all things obtained at a fire-sale price, these vehicles come with a big asterisk that current owners are learning to deal with.
Related: How Fisker fell from grace
As part of its bankruptcy proceedings, Fisker Inc. is set to sell its remaining inventory of Ocean electric SUVs. New York City-based American Lease, a company specializing in renting and leasing vehicles to rideshare drivers, has agreed to buy the whole lot of 3,321 vehicles for a total of $46.3 million, pending court approval.
Initially, the deal was set for just 2,100 vehicles, but court records show that the new outsized deal was made because the EV startup will not be able to fund payroll and taxes if the deal is not finalized by July 12.
Of the 3,321 vehicles set to be transferred to the NYC-based rideshare vehicle leasing firm, 2,711 of the Oceans are described as being in “reasonably good working order” and having a “Manufacturer’s Certificate of Origin." These vehicles fetched the most expensive price, selling for $16,500 per unit.
Additionally, 351 vehicles that were previously titled are set to be sold for just $3,200 each, and other EVs that have ‘mechanical, cosmetic, or other damage or defects that require repair’ (estimated at over $5,000) have been sold for rock-bottom prices as low as $2,500.
American Lease, the New York City-based company taking advantage of these fire sale prices, is a company that specializes in providing rideshare drivers with vehicles if they do not currently own a vehicle that conforms to the requirements set by services like Uber (UBER) or Lyft (LYFT) . According to its website, the company with offices in Queens, the Bronx and Brooklyn is an official partner with Uber, and offers rideshare drivers the ability to drive new and used Toyota Camrys, Highlanders, or Mercedes Metris vans for as low as $350 per month.
However, the rigorous demands of New York City driving can lead to extensive wear-and-tear and mechanical abuse, especially for TLC-registered rideshare cars, limousines, livery cars and taxicabs. This kind of environment requires operators and drivers to have cars that are not only easy to repair, but ones where spare parts are plentiful.
Unfortunately, lack of spare parts and long wait times for service has been an issue that Fisker owners faced before the company went bankrupt.
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In a report first published by InsideEVs in June, former Fisker employees revealed that the company did not plan to provide or stockpile spare parts for repairing Ocean EVs. Due to the lack of availability of spare parts, Fisker technicians and employees were led to dismantle brand new cars and smuggle various parts in suitcases.
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On a positive note, current Fisker owners remain fairly optimistic. A band of owners, including José De Bardi have started a nonprofit organization called the Fisker Owners Association, an owners club dedicated to finding resources that would keep Ocean SUVs on the road for as long as possible, including vehicle financing issues, support for the Fisker app and finding spare parts for cars.
“We’re feeling positive that we’re going to get some kind of good outcome,” De Bardi told Wired.
Currently, the website for the Fisker Owners Association provides links to dealers in different areas of the U.S. with service departments. Additionally, the subreddit r/FISKER_MAINTENANCE on Reddit also provides the Fisker community with solutions for owner-reported errors.
The fine print of the deal between Fisker and American Lease notes that Fisker won’t honor any vehicle warranties and has no obligation to provide repairs, updates, or maintenance. However, Fisker is set to provide the NYC-based firm with ‘all relevant source code’ and ‘existing developer work’ for the Ocean's software, which will enable them to make any necessary updates on their vehicles.
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