Fisker Ocean reservation cancellations top 40,000 as the EV company tries to fight off bankruptcy, leaked data shows
FREDERIC J. BROWN
- Fisker has faced a wave of reservation cancellations, according to internal data viewed by BI.
- Reservation cancellations for the Fisker Ocean recently topped 40,000. Preorders began in late 2019.
- Fisker recently paused production of its EV and dropped its price by 39%.
Tens of thousands of Fisker customers have canceled their vehicle reservations, according to leaked data obtained by Business Insider, as the electric car company scrambles to find additional financing and a potential bankruptcy filing looms over its operations.
More than 40,000 out of well over 70,000 reservations for the Fisker Ocean have been canceled to date, according to internal company metrics viewed by Business Insider. The company first began accepting pre-orders in November 2019, and announced in February 2023 that it had "approximately 65,000" reservations ahead of its first deliveries.
Fisker was averaging around 70 to 80 cancellations per day in a recent seven-day average, according to the internal metrics viewed by BI.
The reservation cancellations pose an issue for the company, representing potential sales slipping away during a time when the company desperately needs to generate more revenue.
The cancellations also represent a drag on company costs. While it costs $250 to reserve a Fisker, that amount is refundable aside from a $25 processing fee, the company's website says. Individuals who reserve more than one of the company's EVs are entitled to a $100 refund if they cancel, according to Fisker's reservation terms online. The company said a reservation "will hold your approximate spot in our order queue to purchase your Fisker EV."
It's not clear how many reservation cancellations Fisker has already reimbursed in the years since November 2019, when it began accepting reservations, but the total cost to date of around 40,000 reservation reimbursements would be in the ballpark of $9 million.
The company also has a few thousand order cancellations, according to the data viewed by BI, which are different than reservations and not fully refundable. The company says on its website it will keep the $5,000 order deposit, as well as the transportation fee if a cancellation is made after the company has started the process of transporting the vehicle to the customer.
Fisker has delivered more than 6,000 of the vehicles to date since the automaker released the Fisker Ocean SUV in June 2023, according to the metrics viewed by BI.
Fisker confirmed the deliveries but declined to comment on cancellations of reservations or orders.
The automaker dropped prices for its flagship EV by 39% on Wednesday in an apparent attempt to boost sales — meaning the most affordable version of the SUV is now selling for about $25,000.
During Fisker's earnings last earnings call in February, it warned that the company might not have enough funds to survive 2024.
The company said in a regulatory filing earlier this month it had paused production of its electric car for six weeks and it had around $121 million in the bank as of March 15. On March 18, the company said it had secured a commitment for up to $150 million in additional financing from an existing investor. On March 22, Fisker said in a regulatory filing that negotiations with a major automaker had failed and that Fisker was continuing to evaluate strategic alternatives.
The end of negotiations with the major automaker meant that Fisker was unable to meet a closing condition with the existing investor for the up to $150 million of financing previously announced, which meant that the funds were no longer guaranteed, the company said in the regulatory filing. Fisker said in the filing it planned to try to negotiate a waiver to that closing condition or a financing deal with the investor under different terms.
The company is Henrik Fisker's second automotive startup. The Fisker CEO and Danish car designer's previous startup, Fisker Automotive, filed for bankruptcy protection in 2013. Fisker launched his second automotive company in 2016.
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