In a challenging turn of events for electric vehicle manufacturer Fisker, contract auto manufacturer Magna International has expressed doubts about producing the Fisker Ocean crossover this year. During a recent earnings call, Magna’s CEO Swami Kotagiri stated that the company had to revise its 2024 outlook, citing “no additional Fisker Ocean production and lower sales on program delays and mix.”
Kotagiri further disclosed, “Production of the vehicle is currently idled. Our current outlook assumes no further production.” This decision has led Magna to reduce its 2024 sales by approximately $400 million and impact its adjusted EBIT margin by about 25 basis points.
Fisker’s struggles were highlighted when, in March 2024, the company slashed prices for the Ocean, reducing the starting price to $24,999, a significant drop of $24,000. Despite this move, the company managed to deliver only about 200 units through its US and European dealer networks, leaving some customers who paid the original price feeling disgruntled.
This setback comes after Fisker announced at the end of 2023 that over 10,000 Oceans had been built, with less than half delivered. By March 15, 2024, an additional 1,000 units had been manufactured, but with a stockpile of around 4,700 vehicles, mostly from the previous year.
Despite these challenges, Fisker’s CEO Henrik Fisker revealed in late April that there are still four potential buyers interested in rescuing the company. Notably, talks with Nissan, which seemed promising initially, fell through, possibly due to Nissan’s interest in Fisker’s Alaska pickup, a segment where Fisker had a presence.
Initial reviews of the Fisker Ocean were mixed, with some critics highlighting areas for improvement while others praised its potential. However, owners who received their Oceans generally expressed satisfaction, though concerns lingered about Fisker’s future and the impact of any potential bankruptcy on them.
