Electric vehicles may be the future, but Americans have resisted adopting them.
This may be because they are more expensive than internal combustion engine cars and the charging infrastructure to power them has not yet been fully developed.
Even Tesla, the market leader in the electric vehicle space, saw its sales fall 9% in the most recent quarter, worse than the overall trend.
It's also possible that CEO Elon Musk's overtly right-wing political stances have caused the left-wing pro-environmental movement to shy away from the brand.
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Overall, EV sales are clearly weakening.
“U.S. electric vehicle sales growth continues to slow, according to sales data analyzed by Kelley Blue Book,” Cox Automotive reported. In the first quarter of 2024, Americans purchased 268,909 new electric vehicles, according to Kelley Blue Book. “The share of electric vehicles in total new vehicle sales in the first quarter was 7.3%, a decrease from the fourth quarter of 2023,” Cox reported.
Sales have continued to grow annually, but the growth rate has slowed.
“Sales in the first quarter increased 2.6% year-over-year, but fell 15.2% compared to the fourth quarter of 2023. The increase in the last quarter was well below the previous two years,” the site reported. Web.
Tesla should be able to recover from its declining sales, although its reputation has been damaged by its polarizing leader, but smaller players in the space may not survive.
One of the industry leader's most prominent rivals has struggled with sales and recently missed a loan payment, which could force it to file for Chapter 11 bankruptcy.
Fisker faces financial problems
fisker (FSR) has a noble mission. The company says it is “driven by the mission to create the world's most emotional and sustainable electric vehicles.”
That's good, but the company has had difficulty producing cars.
“Fisker Ocean production was 4,789 units in the fourth quarter of 2023 and vehicles delivered to customers totaled 3,818,” the company said in its fourth-quarter report. “Throughout the entire year 2023, 10,193 Fisker Oceans were produced and 4,929 vehicles were delivered.”
The company acknowledged liquidity concerns and said at the top of the report that it is working on a potential transaction that will save the company.
“Fisker is in negotiations with a large automaker for a potential transaction that could include an investment in Fisker, the joint development of one or more electric vehicle platforms, and manufacturing in North America,” the company said.
“Closing of any transaction would be subject to the satisfaction of important conditions, including the completion of due diligence and the negotiation and execution of appropriate definitive agreements.”
The company closed the year with $395 million in cash and cash equivalents. According to the company, that is not enough to survive until 2024.
“The company will need to seek additional equity or debt financing, and there can be no assurance that Fisker will be successful in these efforts,” Fisker said.
As a result, “the company expects to conclude that there are substantial doubts about its ability to continue as a going concern when its annual financial statements for the year ended December 31, 2023 are filed with the SEC.”
Fisker misses a loan payment
The electric vehicle maker recently filed an 8-K with the Securities and Exchange Commission detailing that it has missed a key loan payment.
“The filing claims that Fisker failed to repay a loan totaling nearly $3.5 million last month, potentially bringing down the curtain on the second version of the company that is on the brink of possible bankruptcy.” electrek reported.
Fisker's financial honesty (which is required by law) could be compounding its problems as “tens of thousands” of people have canceled their reservations at Ocean, according to the EV news website.
That makes sense because people don't want to invest in a high-end, high-priced vehicle if the company that makes it won't be available to repair it.
“With millions of dollars owed on loans and the looming threat of late fees and applicable interest, Fisker may need to come up with what is left to pay off his loan, although repayment (of any amount) may result in bankruptcy,” he added. Electrek.
The company has not revealed new details about the possible transaction with a large automaker.
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