In an attempt to free up $300 million in working capital, California-based EV startup Fisker reduced its annual production guidance, the company announced in a business update on Friday.
According to Fisker, it plans to build roughly 10,000 automobiles this year. Less than a month has passed since Fisker reduced its 2023 car production goal to 13,000–17,000 units. The production guidance represents only 25% of Fisker’s optimistic prediction from the previous year. Owing to high demand in the United States and Europe, Fisker announced in November 2022 that it intended to produce 42,400 Ocean SUVs by the end of 2023. That optimistic estimate was slashed twice, to 32,000–36,000 cars in May and 20,000–23,000 cars in August. Since spring, four changes have been made with this most recent update.
According to the business update, the production cut will give the company “flexibility” by enabling it to access $300 million in working capital.
“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,” Chairman and CEO Henrik Fisker said in a statement. “We may not have hit our original forecast but taking current market conditions and negative sentiments around EV sales into account, I would say we are doing quite well, as we continue to accelerate sales and deliveries. This is yielding considerable revenue as we ramp up our business. I expect by the end of this year we will have delivered more customer cars than any Western EV startup did in their first year of deliveries. The company continues to sharpen its focus on growing its current markets and enhancing our sales and service offerings for the Fisker Ocean.”
Fisker reported in its business update that it overcame early logistical challenges by implementing a new strategy to enhance deliveries in the U.S. and Europe. Fisker did not specify the specific difficulties faced, but it seems that the plan calls for expanding the number of transportation logistics firms to expedite deliveries, reaching out to more reservation holders, and building new locations for retail, deliveries, and service.
The business announced that it is also starting a leasing program in the United States, Canada, and Europe, but it gave no indication as to when that might happen.
A hiring update was also given by Fisker, highlighting the appointment of Dan Quirk as the organization’s new executive vice president of finance and accounting. The hiring comes after Fisker postponed filing its quarterly earnings report with the Securities and Exchange Commission and lost two chief accounting officers in quick succession. Additional appointments include Wolfgang Hoffmann as country manager in Canada, where Fisker is set to start deliveries, Axel Buhr as vice president of finance and controller operations, and Ram Iyer as senior VP of EE integration and validation.