In an effort to avoid bankruptcy, electric car maker Fisker Inc. is closing. its headquarters in Manhattan Beach and has secured a $3.5 million lifeline as it continues to explore an acquisition or other strategic alternative.
The struggling company, which had about 300 employees 72,000 square meters of offices will move its remaining employees to an engineering and distribution facility on La Palma in Orange County at the end of March, said a person familiar with Fisker's operations who was not authorized to comment.
In total, the company employed approximately 1,135 employees as of mid-April, following an announced 15% workforce reduction.
Fisker has been trying to avoid bankruptcy since March, when it announced it had ended talks on a strategic alliance with a major automaker, ending a deal that would have given the company $150 million in new financing.
That sent the shares plunging to pennies, prompting the New York Stock Exchange to delist the shares in violation of another debt deal the company made with an investor last year, according to a filing with the supervisor.
A major automaker, reportedly Nissan, was reportedly in talks to invest in Fisker. Nissan was considering making the Fisker Alaska truck in a U.S. factory — a deal that would involve a $400 million investment. Reuters first reported this. Fisker did not confirm the reports.
Fisker announced this this week secured a $3.5 million short-term loan, while continuing to operate and sell its mid-size Ocean SUV. The note matures on June 24 and has the potential to rise to $7.5 million.
The Ocean, a competitor to Tesla's Model Y, was released last year to mixed reviews; Some praised its construction and styling, but the car was plagued with software problems.
The National Highway Traffic Safety Administration (NSA) did just that four studies in the vehicle, including one opened this month after complaints that the SUV's automatic emergency braking system activated randomly.
Other probes are investigating reports of a door not opening on the Ocean and complaints of loss of braking performance. The company says it is cooperating with the regulator.
Fisker said this week it had added three dealerships to its networks in California and New Jersey, which it began building after a plan to sell directly to consumers — as Tesla does — fell through. It also announced additional price reductions for some Ocean models.
In March Fisker the price reduced on the entire 2023 Oceans lineup by more than 30%. The company also said it had halted production at its contract factory in Austria, which produced about 10,200 oceans last year.
Fisker was founded in 2016 by renowned car designer Henrik Fisker, who said the Ocean was inspired by California. The SUV features a full-length sunroof, an interior made of 'vegan' recycled plastic and a fold-down rear window that can fit a surfboard.
Fisker isn't the only startup struggling with a slowdown in the domestic electric vehicle market and a rise in interest rates.
Rivian Automotive, an Irvine electric truck maker, has told state officials it will lay off more than 120 employees starting in June. In February, the company announced it would cut 10% of its workforce. The company's shares have lost more than half their value since last year.
