According to media reports, electric vehicle manufacturer Fisker announced on March 18 that it will halt production for six weeks. After missing an interest payment, the company raised up to $150 million by selling convertible bonds, as the startup is currently working to address financial constraints.
Fisker added that it did not produce any Ocean SUVs in January this year, while its production partner Magna's Austrian unit manufactured about 1,000 vehicles between February 1 and March 15. Fisker delivered around 1,300 vehicles in 2024, with the inventory value of completed cars exceeding $200 million.
Reportedly, the original issuance discount for Fisker's preferred convertible bonds was 10%, with total proceeds reaching up to $150 million. Fisker stated in filings submitted to the U.S. Securities and Exchange Commission (SEC) that these notes will be sold to CVI Investments, which operates through Heights Capital Management and can convert the bonds into Fisker's equity.
Fisker mentioned that despite having sufficient liquidity, the company did not pay $8.4 million in interest on some convertible notes due in 2026 on March 15. This was because the company wanted to utilize a 30-day grace period to explain its capital structure to investors.
As of March 15, the company's cash, cash equivalents, and restricted cash balance stood at $120.9 million, down from $395.9 million at the end of last year.
On March 18, Fisker reiterated that it is in negotiations with a large automaker for a potential deal but did not disclose its name. Earlier this month, foreign media reported that Nissan is in advanced talks to invest in Fisker, with the deal potentially serving as a lifeline for the cash-strapped electric vehicle manufacturer.
Earlier this year, Fisker began transitioning its sales strategy from direct-to-consumer to relying on dealerships due to distribution and service-related issues.
In February, Fisker expressed significant doubts about its ability to continue operations and suspended investments in future projects until it forms a partnership with an automaker.
