Fisker filed for Chapter 11 bankruptcy protections on Monday, marking a brutal blow to the startup that was once worth as much as $8 billion.
“Like other companies in the electric vehicle industry, we have faced various market and macroeconomic headwinds that have impacted our ability to operate efficiently,” Fisker said.
The company said that its manufacturing pause would remain in place but that it plans to file “customary motions” with the bankruptcy court to ensure it can continue to pay employee wages and its vendors.
As the EV industry at large faced headwinds this year, Fisker was no exception.
It encountered difficulty selling its EVs and some very public complaints from customers as it raced to shore up more financing and potential rescue buyers. Last week, the company initiated a recall for a software-related issue that it said caused some of its vehicles to suddenly lose power.
Fisker has initiated a series of layoffs over the past few months. In April it told workers it would further reduce its workforce to “preserve cash.” That was after the company said in February that it planned to slash its workforce by 15%. The company brought in a chief restructuring officer who was given “sole authority” over some financial matters, including a potential sale, as part of an agreement with one of its investors.
Fisker had been looking for potential buyers to stave off bankruptcy. Fisker CEO Henrik Fisker told staff in April that the startup was in talks with four automakers for a potential buyout, BI reported.
EV makers Lordstown Motors and Arrival have also filed for bankruptcy in the past year.
It’s another sign of how difficult it is to run a successful EV business in the current economic environment, with industry stalwarts like Tesla, Rivian, and Lucid all cutting their workforces as weakening demand squeezes the electric vehicle industry.
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