Struggling EV Maker Fisker Can’t Find a Dance Partner

The gaping potholes that have emerged on the road to the EV future have swallowed another startup.

Fisker’s stock tumbled further on Monday (hard to do from 12 cents a share), and the company’s ability to stay in business appears in jeopardy following its announcement that a partnership deal with a larger automaker had broken down. 

Not Enough Charge

EVs are more popular and well-designed than ever, but even the biggest carmakers — General Motors, Ford, and Mercedes-Benz — have had to scale down or slightly delay their plans as demand slows. 

Startups like Fisker — which don’t have decades’ worth of customer loyalty, expansive facilities, or tens of billions of dollars at their disposal — face an even tougher uphill climb:

• In February, Fisker announced it was negotiating with another carmaker for some kind of partnership that could have involved an investment, joint development, or use of the automaker’s facilities. The Wall Street Journal reported earlier this month that the company had hired advisers to help with a possible bankruptcy filing.
• As a result of the partnership deal falling through, Fisker said it wouldn’t be able to meet the closing condition of a $150 million financing commitment that it had entered into with an investor, according to The Wall Street Journal. Earlier this month, Fisker paused production for six weeks, and on Monday, its share price fell another 28% to just under 9 cents a share. The stock was trading near $7 as recently as last September.

And it’s not just little guy Fisker asking for help. The need to team up is being seen throughout the industry. Nissan, a nearly 100-year-old company, plans to cut the cost of its EV manufacturing by 30% thanks to partnerships with France’s Renault and Honda, per the Financial Times. 

It’s Not Easy Being EV: Three EV startups — Lordstown Motors, Proterra, and Electric Last Mile Solutions — have all filed for bankruptcy. Plus, startup vehicles tend to cost more than what the average driver wants to pay. The Fisker Ocean SUV costs $62,000 — that’s about $20,000 more than a new Tesla Model Y or Ford Mustang Mach E. Even a bigger player in the startup space like Lucid, which is partially backed by that sweet Saudi oil money and just raised $1 billion from the Gulf kingdom, still faces weak demand for its luxury cars. If EVs were mousetraps, right now the goal isn’t about building a better one, but rather a cheaper one.