Introduction Of Fisker
Bankrupt EV startup Fisker has made a significant reversal just days after announcing that Ocean SUV owners would bear the labor costs for certain recall repairs. In a statement posted on its website FAQ page, the company clarified, “Fisker will provide the necessary parts (including the labor) at no cost to you,” signaling a pivot from its original stance.
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Fisker initially broke the news to thousands of Ocean SUV owners on Sunday, when it revealed details about five recalls. Three of these recalls—related to sudden power loss, incorrectly displayed warning lights, and reduced regenerative braking—can be resolved via over-the-air software updates, at no charge to owners.
However, two more serious issues require physical repairs. Faulty door handles and a malfunctioning electric water pump, which was causing some vehicles to lose power, must be addressed. Initially, Fisker told owners that while it would cover the cost of the necessary parts, they would need to pay for labor during inspections and repairs performed at authorized service providers. These providers are expected to be listed by the end of September 2024.
This backtrack comes amid Fisker’s ongoing Chapter 11 bankruptcy proceedings, now entering its fourth month. The company has reached a settlement plan with its major stakeholders, including its secured lender, the unsecured creditors committee, contract manufacturer Magna, and other involved parties. After heated negotiations, the parties agreed on how to divide the proceeds from the liquidation of Fisker’s assets.
It has already sold off nearly all of its remaining vehicle inventory to New York-based leasing company American Lease for up to $46.25 million. Now, the focus shifts to liquidating more than $1 billion worth of remaining assets, including manufacturing equipment previously housed at Magna’s factory in Austria, to repay creditors.
A court hearing in early October is expected to approve the settlement plan. Meanwhile, this decision to cover recall repair costs in full is a notable move for the struggling company as it works to resolve the issues faced by Ocean SUV owners and complete its asset liquidation.
Update: This article was originally published on September 16 and updated on September 18 to reflect Fisker’s decision to cover both parts and labor for the recall repairs.
