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Bankrupt California EV maker Fisker is selling its inventory of luxurious cars for enormous discounts as it clambers for cash
A California EV maker once worth $8 billion has been granted the ability to sell their cars at a massive discount as they're desperate to raise cash.
Fisker is the second automaker by famed car designer Henrik Fisker to file for bankruptcy protection. Fisker filed for bankruptcy last month after attempts to find a buyer failed.
The CEO and his wife each voluntarily reduced their salaries to cut costs, with Henrik dropping his wage to just $1 from $62,400 plus a bonus of $710,000. The company's stock price has dropped 85 percent in the past month alone.
In recent weeks, the company has filed asked a federal bankruptcy court judge to allow them to sell their fleet to American Lease, which provides cars to New York City-area Uber drivers.
That request was granted and they will now begin the process of off-loading more than 3,000 of its Ocean SUVs for about $46.25 million, an enormous discount rate.
Fisker is the second automaker by famed car designer Henrik Fisker to file for bankruptcy protection. Fisker filed for bankruptcy last month after attempts to find a buyer failed
The company's stock price has dropped 85 percent in the past month alone
American Lease was the only dealer out of 'hundreds' that agreed to by the fleet, according to Tech Crunch.
Prospects were dire because the company has to wait for most of the vehicles to pass recall inspections.
The company now can move forward with bankruptcy hearings as a major part of their business has been liquidated.
Henrik Fisker, who helped design the popular Tesla Model S, founded the company as an affordable alternative in the EV market in 2017.
Fisker, a designer, is also known for leading the development of the BMW Z8 sports car.
He had ambitious plans including a flagship SUV EV called the Ocean which was released in June 2023 and cost upwards of $38,000.
However, attempts to outsource production quickly hit obstacles and Fisker struggled with parts shortages.
At one point, the auto maker had to strip parts from Fisker and his wife's cars to make repairs to the first batch of Oceans.
Henrik Fisker, CEO of the eponymous car company, has slashed his wage to just $1 to help cover the bankruptcy process
The problems extended beyond production however, after 14 complaints were made to the National Highway Traffic Safety Administration (NHTSA) about the vehicle's doors failing to open.
Worryingly, some of the reports claimed that the emergency override could not release the door,' Securities.io reports.
The NHSTA will conduct a preliminary evaluation, which will become the third case it has open against Fisker.
The embattled company faced a further set back when popular auto reviewer Marques Brownlee, who's behind the MKBHD YouTube channel, branded the Ocean, 'the worst car I've ever reviewed'.
He complained about issues with the car's software and claimed Fisker tried to stall providing him a vehicle to review until it had issued a new update.
Brownlee ended up borrowing one of the cars from another dealership but was left unimpressed.
'Do not buy this version of the Fisker Ocean,' he urged his 18.6 million subscribers.
In response, Fisker told the media the issues flagged had predominantly been found in earlier runs of models and that the company is continuously working to fix and update features.
Husband and wife COO Geeta Fisker and CEO Henrik Fisker, left, have both voluntarily reduced their salaries
But Brownlee's video notched up five million views and preceded a steep plummet in Fisker stock.
Sales of the Ocean has stalled, with Fisker missing its own sales targets. In March, it announced it was lowering the retail price of its 2023 Ocean Extreme by $24,000.
'We are aware that the industry has entered a turbulent and unpredictable period,' Fisker said in a statement at the time.
'With that understanding and taking the lessons learned from 2023, we have put a plan in place to streamline the company as we prepare for another difficult year.'
The company now hopes to shift its 3,300 unsold Oceans onto ride hailing apps like Uber and Lyft for 80 percent below market rate.
Plunging share prices have meant that NYSE, the world's largest stock exchange, delisted Fisker over failure to comply with norms.
The company was removed due to 'abnormally low' price levels, which saw shares traded for under a dollar.
Over the past month, the company stocks have plummeted 94.9 percent. As of Wednesday morning, the company was worth less than $10 million.
The company has been besieged by issues around its EV SUV, the Ocean, launched in 2023
Fisker is now attempting to sell off its assets to help cover bankruptcy costs
In February, 2021, Fisker shares were trading as high as $28, valuing the company at almost $8 billion.
Delisting means the company now must immediately pay off its debts due in 2025 and buy back bonds due in 2026, according to a regulatory filing.
Fisker stated in its filing with the Securities and Exchange Commission (SEC) that it may not have 'sufficient cash reserves or financing sources' to pay off its debts.
DailyMail.com has contacted Fisker for comment.