- Fisker Inc.’s Austrian unit has filed for insolvency proceedings under Austrian law. This is similar to bankruptcy but with specific legal processes in Austria.
- The news comes after Magna Steyr, the contract manufacturer for the Ocean, halted production at their Austrian facility in March with no plans to resume.
- While Fisker intends to continue deliveries and service existing vehicles, the long-term production of the Ocean remains uncertain.
Update: Fisker Inc.’s Austrian unit announced on Tuesday that it has voluntarily filed for bankruptcy protection through self-administration under the Austrian Insolvency Code. This decision comes after Magna Steyr revealed on Monday that it had halted production of the Ocean in March at its facility in Austria and does not anticipate any further production.
“The proceeding will enable Fisker Austria to ensure its operations are able to continue under court protection, including paying employees and selling vehicles,” the company said in a statement.
“Fisker Austria intends to continue delivering its vehicles to customers to the extent possible, providing service, and updating its over-the-air software as it moves through the restructuring proceedings. Fisker’s other entities are not included in the Austrian restructuring proceeding and continue to operate in the ordinary course,” the company added.
–Original story follows below–
Things keep going from bad to worse for Fisker. Soon after the company announced impending layoffs, and after it was sued by an engineering firm, the contract manufacturer that builds the Ocean SUV “assumes” it won’t be building any more.
Rather than building the Ocean itself, Fisker has contracted Magna International to assemble each and every example through the Magna Steyr subsidiary in Austria. Production was paused in March and while speaking on the firm’s most recent earnings call, Magna chief executive Swamy Kotagiri revealed it is still idled.
Read: Report Claims Fisker Using Prototype And ‘Graveyard’ Parts To Fix Customer Cars, Company Denies
“It is important that I provide an update on our current status for the Fisker Ocean program,” he said. “Production of the vehicle is currently idled. Our current outlook issued today assumes no further production.”
Although Kotagiri didn’t say definitively if production of the Ocean has ceased for good, Magna International chief financial officer Pat McCann doubled down on the assumption the Ocean is dead while speaking on the call.
“As Swamy mentioned earlier, we are assuming no more production of the Fisker Ocean,” he said.
The company believes it will lose about $400 million in sales if production of the Ocean doesn’t resume. Magna added it has $195 million in deferred revenue associated with the Fisker contract that will be recognized as income if performance obligations are met or if its contract manufacturing agreement with Fisker is terminated, Yahoo! Finance reports.
In mid-March, Fisker paused production of the Ocean for six weeks while it desperately scrambled to strike a deal with a large automaker. Just two weeks later, it was reported that talks with other OEMs had broken down, leaving Fisker without a lifeline and edging closer to bankruptcy.
Fisker filed documents with the SEC in late April that revealed it had missed a required interest payment worth $8.4 million and said it may have to file for bankruptcy in the next 30 days if it doesn’t get debt relief.
