Electric vehicle company Fisker’s stock plunged more than 40% in after-hours trading on Wednesday as investor concern about the company’s ability to stay in business intensified.
On Wednesday, the Wall Street Journal, citing people familiar with the matter, reported that Fisker had hired restructuring advisers to work on a potential bankruptcy filing.
Fisker declined to comment on the report, but earlier this month, the EV maker warned that it might not have enough money to survive another year.
In its fourth-quarter earnings report, released in February, the company said there was “substantial doubt about Fisker’s ability to continue as a going concern.”
At the time, Fisker said it was in discussion with an existing investor about possibly putting more money into the company to keep it afloat. The automaker said it would also lay off 15% of its workforce to cut costs.
Fisker, which sells the Ocean electric SUV, has an unusual business model in which it has entirely outsourced the manufacturing of the one model it currently sells. The Ocean is built in Austria by Magna, a company that has also built vehicles for Mercedes-Benz, BMW and Jaguar.
Last year, Magna produced more than 10,193 Fisker SUVs, but fewer than half of those were delivered to customers within the calendar year, the company previously announced. Fisker expects to deliver about 20,000 this year, it added.
Last month, the company was dealt a social media headache when Marques Brownlee, an American YouTuber, madeh a video about Fisker’s Ocean model for his YouTube channel titled, “This is the Worst Car I’ve Ever Reviewed.”
“Do not buy this version of the Fisker Ocean,” reads the video’s description. Brownlee’s video has racked up more than 4.5 million views so far and sent the stock plunging after its release.
Fisker’s stock was trading at 32 cents a share at the close of trading Wednesday, a more than 80% decline since the start of 2024.
Fisker is founder Henrik Fisker’s second car company. His first, Fisker Automotive, produced a plug-in hybrid luxury car called the Fisker Karma. That company went bankrupt in 2013 after Hurricane Sandy wiped out much of its inventory.
CNN’s Peter Valdes-Dapena contributed to this report.
