Why Fisker stock fell this week

Electric vehicle (EV) manufacturer fisker (FSR 4.93%) It has been no stranger to bad news in recent months, with the company lowering its annual production target, facing liquidity issues and filing its 10th quarter report late. Moreover, the CFO resigned just a week after taking office.

EV stocks fell this week following news reports raising doubts about both the product and its financial outlook.

Concerns that the stock market has overheated have led to a decline in stock prices this Thursday, with stock prices down 8% for the week as of 2:49 PM ET, according to data from S&P Global Market Intelligence. It appears to have declined.

Image source: Fisker.

Fisker is still stuck in reverse.

Fisker’s shares fell 2.5% on Tuesday after The Information reported that some customers were disappointed with their new vehicles. Among the complaints about new cars were mechanical defects that made them dangerous or missing features that the company had promised to provide. Others attempted to cancel $5,000 pre-order payments.

In a separate announcement, the company said it has expanded its services capabilities in North America and has filled several key positions, including hiring a director of technical services to begin next month.

Stocks fell on Wednesday amid widespread selling in the market as investors unwinded some of the recent rally. also, that much wall street journal It detailed the cash crisis facing several EV manufacturers, including Fisker. According to the report, Fisker finished the third quarter with 187 days of cash remaining. That means it may be cash-strapped in the second quarter, but management said its cost structure would improve after initial efforts to deliver new vehicles.

What’s next for Fisker?

Since the new Fisker Ocean has won so many awards, the customer complaints seem somewhat surprising. In fact, last week it was named best fully electric car in a French competition called Automobile Awards 2023.

Still, mass production is a more difficult task, and individual vehicles may have issues, which is more likely because the company has outsourced manufacturing.

The company’s finances are another big issue, but if Fisker can continue to ramp up production, it will buy itself time and will likely get more financing if needed.

Stock price volatility is expected to continue in 2024. A turnaround is possible, but the company has a lot to prove.