In a bid to free up $300 million in working capital, California-based electric vehicle (EV) startup Fisker has cut its annual production guidance. According to the company’s latest business update, Fisker expects to produce approximately 10,000 vehicles this year.
A Series of Production Guidance Cuts
This latest reduction marks the fourth time Fisker has lowered its production forecast since the spring. In May, the company slashed its target from 32,000-36,000 vehicles to 20,000-23,000 units. Prior to that, in August, Fisker had cut its projection from 42,400 Ocean SUVs to 20,000-23,000 vehicles.
The initial forecast of producing 42,400 Ocean SUVs by the end of 2023 was made in November 2022 due to strong demand in both the U.S. and Europe. However, this optimistic outlook has been steadily reduced as market conditions and sentiment around EV sales have changed.
Accessing Working Capital
By lowering its production guidance, Fisker aims to free up $300 million in working capital. This move will provide the company with the necessary flexibility to navigate the current market conditions. According to Fisker’s Chairman and CEO Henrik Fisker, "Our teams have worked hard to overcome some early delivery challenges and are now setting an impressive pace as we prepare to close out 2023."
Recent Developments at Fisker
Fisker has been working diligently to improve its logistics and delivery processes in the U.S. and Europe. The company has launched a new strategy to enhance deliveries, which involves adding more transportation logistics companies to speed up deliveries, increasing outreach to reservation holders, and opening more facilities dedicated to retail, deliveries, and service.
Furthermore, Fisker is set to launch a leasing program in the U.S., Canada, and Europe. However, details regarding the leasing program’s timeline have not been provided.
Hiring Spree at Fisker
In recent months, Fisker has made significant hires, including Dan Quirk as its new executive vice president of finance and accounting. This comes after the company lost two chief accounting officers in quick succession and delayed the filing of its quarterly earnings report with the Securities and Exchange Commission.
Other notable hires include:
- Axel Buhr: Vice President of Finance and Controller Operations
- Ram Iyer: Senior VP of EE Integration and Validation
- Wolfgang Hoffmann: Country Manager in Canada, where Fisker is about to begin deliveries
Moving Forward
As the EV market continues to evolve, companies like Fisker are adapting to changing conditions. By lowering its production guidance and accessing working capital, Fisker aims to maintain a strong foothold in the industry.
Fisker’s ability to navigate these challenges will be crucial as the company moves forward with its ambitious plans. The company’s commitment to delivering exceptional vehicles while improving its logistics and service offerings will play a significant role in shaping its future success.
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