At a time when troubled electric vehicle startup Fisker is looking for a life raft to stay afloat in 2024, the company hired to build its Ocean crossover doesn't seem terribly optimistic about its prospects.
Magna International, the contract auto manufacturer that builds the Fisker Ocean, doesn’t expect to build the electric crossover anymore this year. During a recent earnings call, CEO Swami Kotagiri revealed that Magna had to adjust its outlook for 2024 after “assuming no additional Fisker Ocean production and lower sales on program delays and mix.”
Kotagiri, quoted by Yahoo Finance, added that “production of the vehicle is currently idled. Our current outlook issued today assumes no further production. Consistent with disclosure, we provided in our annual information form, this assumption reduces our 2024 sales by about $400 million and impacts our adjusted EBIT margin by about 25 basis points.”
Get Fully Charged
Fisker is not doing great
2024 has been pretty bad for Fisker, which lowered the price of the Ocean EV by $24,000 in the hopes of delivering the nearly 5,000 vehicles it had stockpiled to help pay off its over $1 billion debt.
At the end of 2023, Fisker announced that over 10,000 Oceans had been built, and a little under half had been delivered. By March 15, Fisker reported that another 1,000 had been manufactured, but the company had a stockpile of about 4,700 vehicles, most of which were built the year before.
In what was seen as a last-ditch effort to stay alive, Fisker cut Ocean prices in March of this year, drastically lowering the price by $24,000 and making the most affordable cost $24,999. However, it only managed to deliver about 200 units after the price drop through its six-strong US dealer network. The company also has 12 partner dealers in Europe.
Fisker cutting Ocean prices by as much as it did left owners who paid the original full price feeling cheated, seriously affecting the company’s image and credibility. The New York Stock Exchange even de-listed Fisker stock after its shares had reached an “abnormally low” price.
Things weren’t looking great for Fisker, but in late April, company boss Henrik Fisker said that there were still four companies interested in saving the ailing automaker. He didn’t say what companies, but we know Nissan isn’t one of them since we know takeover talks with the Japanese automaker fell through. This is probably because Nissan was most interested in Fisker’s Alaska pickup, according to various reports, but then it apparently backed out of the deal.
When the first reviewers got their hands on the Fisker Ocean, opinions were mixed. Some said it was a bad vehicle that needed a lot more work to become competitive, while others saw plenty of substance in the Ocean and were not as quick to criticize it.
Despite the negative press it received, owners who took delivery of their Oceans had mostly good things to say about it—although they were all undoubtedly worried about Fisker’s future and what its bankruptcy could mean for them in the future.
