Benzinga - by Anan Ashraf, Benzinga Editor.
Beleaguered electric vehicle startup Fisker Inc. reportedly lost millions of dollars in customer payments due to lax internal procedures. This forced an internal audit in December and diverted resources from the company’s sales team during a crucial restructuring period.
What Happened: According to TechCrunch, citing anonymous sources, the company eventually recovered most of the payments, which included down payments and full vehicle prices. However, the internal confusion caused delays in processing these funds.
“Checks were not cashed in a timely manner or just lost altogether. We were often scrambling to find checks, credit card receipts, and any wired funds months after a vehicle was sold,” an anonymous source told TechCrunch.
This disarray reportedly contributed to Fisker’s delay in filing its annual financial report for 2023. The company was unable to accurately determine its revenue due to the payment issues.
Price Cuts In Face of Challenges: Adding to its woes, Fisker announced significant price cuts from Friday for various trims of its 2023 Ocean SUV models. While the Extreme trim of Fisker’s Ocean SUV is now priced $24,000 lower at $37,499, the Ultra trim will be priced $18,000 lower at $34,999 and the Sport trim $14,000 lower at $24,999.
These price cuts follow Fisker’s recent delisting from the New York Stock Exchange due to low share prices. Additionally, potential investment talks with a major automaker recently collapsed, leaving Fisker’s financial future uncertain. The company had previously expressed concerns about its ability to generate enough revenue to stay afloat.
Why It Matters: Fisker’s cash balance has dwindled from $736.5 million at the end of 2022 to $325.5 million by December 2023. The company reported a net loss of $463.6 million and revenue of $200.1 million for the fourth quarter.
Despite producing around 10,200 Ocean SUVs in 2023, Fisker only managed to deliver 4,929 vehicles.
The company currently holds an inventory of approximately 4,700 vehicles, including both leftover 2023 models and newly produced 2024 units. To address inventory and financing issues, Fisker initiated a six-week production pause earlier this month.
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