Fisker Inc., an EV startup, filed for Chapter 11 bankruptcy protection just one year after shipping its Ocean SUV to customers around the world. The company’s failure can be attributed to its lack of preparedness in handling the challenges that arise after a car is put on the road. Employees had expressed concerns about the company’s focus solely being on building the car and not the entire company.
This lack of preparedness was evident in various aspects of Fisker’s operations. The software powering the Ocean SUV was underdeveloped, leading to delays in the launch and causing issues with the first deliveries. Quality and service problems plagued the Ocean, with customers experiencing power loss, braking system troubles, glitchy key fobs, and problematic door handles. The National Highway Traffic Safety Administration opened four investigations into the Ocean.
Furthermore, Fisker struggled with the quality of its suppliers and failed to build a proper buffer of spare parts. As a result, employees had to resort to plucking parts from Magna’s production line and even from Henrik Fisker’s personal car. Lower- and mid-level employees went above and beyond to assist customers, often working long days, nights, and weekends.
Fisker also faced challenges as a public company, losing track of customer payments and experiencing delays in reporting to the Securities and Exchange Commission. The company admitted it did not have enough staff to handle customer service requests, leading employees from other departments to pitch in.
Despite these issues, Fisker touted its speed to market as an accomplishment, failing to acknowledge the numerous problems that contributed to its bankruptcy filing. The company will now undergo Chapter 11 proceedings to settle its debts and restructure its assets. The future of Fisker’s planned products, such as the sub-$30,000 Pear EV and Alaska pickup, is uncertain as the engineering firm co-developing them has sued the startup.
Fisker plans to continue reduced operations and preserve customer programs while seeking a buyer for its assets. However, the ultimate fate of the startup won’t change the fundamental problem: Fisker was not prepared to address the challenges of bringing a flawed car to market. The bankruptcy serves as a cautionary tale for other EV startups, highlighting the importance of focusing on all aspects of the business, not just product development.
