EV company Fisker declares bankruptcy, but that’s okay

The first time I heard of Fisker was when Scooter Braun and Ellen DeGeneres gave Justin Bieber a chromed out Fisker karma for his 18th birthday on daytime television. It was 2012 and a time when electric vehicles were firmly seen as luxury vehicles, play things for those that could afford them. Tesla had only released the original Roadster at the time and the Model S would actually launch that summer.

The company’s logo and name were everywhere in the following months as paparazzi sightings of Bieber were plastered across every tabloid and click-bait article. In writing this article I realized I hadn’t thought of the company in years, and maybe that was one of the problems that ultimately led to this week’s Chapter 11 bankruptcy filing for the California company.

R.I.P. Fisker Automative 2007 – 2014

The company’s troubles began early

Danish automobile designer Henrik Fisker founded Fisker Automotive in 2007 in Anaheim, California. After launching its first plug-in hybrid, the Fisker Karma, the company was quickly beset by setbacks left and right. From a lawsuit with Tesla, a recall of its batteries, a fire that destroyed its entire European shipment of Fisker Karmas, and defaulting on US government loans, the troubled company began bankruptcy proceedings in 2013. In 2014, after the bankruptcy auction had concluded, Henrik Fisker retained the trademarks for the logo and company name, which he would use to start Fisker Inc. in 2016.

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R.I.P. Fisker Inc. 2016 – 2024

If at first you don’t succeed…

Fisker

In 2016, Henrik Fisker, together with his wife Geeta Gupta-Fisker, founded Fisker Inc., a company that would go on to last barely one year longer than the first one. Having raised money from investors in 2020 and completed an initial public offering through a SPAC in the same year, the new Fisker Inc. seemed poised for more success than the first time around.

The hope was short-lived, however, as by 2024 the company had only one production vehicle to its name. The Fisker Ocean, first produced in 2023, had faced over 100 loss-of-power incidents across units sold to customers and was the subject of three separate investigations by the National Highway Traffic Safety Administration. In March of 2024, Fisker Inc. declared a net loss of over $400 million and said they had entered talks with major auto manufacturers regarding a cash injection or acquisition. By the summer of 2024, it became clear these talks had not materialized any real solutions, and the company declared bankruptcy on June 17, 2024.

The EV market is still growing, but slowing from recent years.

Reports of the death of the electric vehicle are greatly exaggerated

Michael Förtsch / Unsplash

Fisker is the second electric vehicle manufacturer to declare bankruptcy this year, though the other is one you’ve never heard of that brought one vehicle to market briefly in 2022 before recalling it and ceasing production less than six months later. While some might say news like this spells doom for electric vehicles, reports of the death of the electric vehicle are greatly exaggerated. 2024 EV sales in Europe, the US, and Canada have arrived at a sort of plateau, with sales in the first five months of 2024 growing only 4% and 5% year-over-year, respectively, over the same period. However, EV sales globally are up 20% from the same period last year, as adoption and growth in China have accelerated.

The rate of adoption for EVs in North America and Europe is certainly slowing, as the next tranche of would-be adopters will be harder to convince than the first few. For the most part, die-hard EV fans and tech-savvy consumers well-versed in the features, range, and dependability of EVs, who needed little convincing, already own electric vehicles. But the next group of adopters will be a harder sell. Less than half of adults, when asked, say they would consider an EV for their next car purchase, down from just over half in 2023. This dampened enthusiasm foreshadows a slower rate of growth and adoption for EVs in the short to medium term.

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A bright future, with growing pains

Some stumbles were inevitable

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While companies like Ford and GM are scaling back investment in their EVs, others like Toyota, Hyundai, and Kia are seeing rapidly accelerating success. Hyundai saw their EV sales grow by 100% in March thanks to the success of the IONIQ, and Kia’s EV sales in May showed over 100% growth year-over-year. These cars are definitely still selling, but consumers are becoming more discerning on price, features, and design. Perhaps crucial to this success is that more recent models of EVs like the IONIQ and the BMW i4 look just like your old gas car, with the same exterior and interior styling that drivers have become accustomed to; they just happen to be electric. Perhaps designs that are more “normal car” than “spaceship” help convince a more traditional crowd to give EV adoption a chance.

EV sales overall are expected to exceed last year’s by over 20% worldwide, and while that is certainly at a slower clip than in more recent years, the global EV market is certainly not shrinking by any means. It is simply becoming more efficient, as manufacturers that cannot compete, either due to razor-thin margins, poorly designed vehicles, or improperly priced models, fall by the wayside, while those that understand the end consumer best pick up the slack.