EV maker Fisker’s stock price plummets following reports that the company is considering bankruptcy

CNN
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Shares of electric car company Fisker plunged more than 40% in after-hours trading on Wednesday as investors grew concerned about the company’s ability to continue operating.

The Wall Street Journal reported Wednesday that Fisker has hired a restructuring advisor to consider the possibility of filing for bankruptcy, citing people familiar with the matter.

Fisker declined to comment on the report, but warned earlier this month that the company may not have enough cash to survive another year.

In its fourth quarter earnings report released in February, the company said: “There are serious questions about Fisker’s ability to continue as a going concern,” he said.

At the time, Fisker said he was talking with existing investors about the possibility of putting in more money to keep the company afloat. The company announced it would lay off 15% of its employees to cut costs.

Fisker, which sells the electric SUV Ocean, has adopted an unusual business model in which it outsources the entire manufacturing of the one model it currently sells. The Ocean is manufactured in Austria by Magna, which also makes vehicles for Mercedes-Benz, BMW, and Jaguar.

Last year, Magna produced more than 10,193 Fisker SUVs, but less than half of them were delivered to customers within the calendar year. announced. Fisker added that it expects to deliver about 20,000 units this year.

Last month, American YouTuber Marques Brownlee created a video on his YouTube channel about Fisker’s Ocean model titled “This is the worst car I’ve ever reviewed,” and the company posted a video on social media. It caused a media headache.

The video description says, “Do not purchase this version of the Fisker Ocean.” Brownlee’s video has been viewed more than 4.5 million times, and the company’s stock price plummeted after its release.

Fisker stock was trading at 32 cents per share at the close of trading Wednesday, down more than 80% since early 2024.

Fisker is founder Henrik Fisker’s second car company. His first company, Fisker Automotive, produced Fisker’s plug-in hybrid luxury car called the Karma. The company filed for bankruptcy in 2013 after Hurricane Sandy wiped out much of its inventory.