Fisker Inc., the electric vehicle (EV) startup, finds itself under the microscope as the National Highway Traffic Safety Administration (NHTSA) launches an investigation into braking concerns surrounding its debut model, the 2023 Ocean crossover. This scrutiny adds to Fisker’s existing challenges, including lower-than-expected demand, unmet sales goals, and a recent overhaul of its sales approach.
Fisker, which went public in 2020 through a merger with a special purpose acquisition company, initiated Ocean SUV deliveries in June 2023, facing delays attributed to software readiness issues. The NHTSA’s Office of Defects Investigation (ODI) is currently examining nine complaints related to the Ocean model, one of which involves a crash and injury. Complaints range from brake loss and gear shifter problems to a driver door malfunction and instances of the vehicle’s hood unexpectedly opening on the highway.
The NHTSA’s investigation zooms in on a “partial loss of braking over low-traction surfaces” without warning, causing an abrupt increase in stopping distance. Additional complaints highlight challenges with the Ocean’s regenerative braking system. This inquiry, categorized as a “preliminary evaluation,” aims to delve into the issue thoroughly and assess potential safety implications.
This development compounds Fisker’s ongoing struggles, including demand falling below projections and internal sales targets proving elusive. In 2023, Fisker produced 10,142 Ocean crossovers globally, yet deliveries amounted to just 4,700 units, primarily concentrated in Europe and the United States.
Adding to the company’s complexities, Fisker recently announced a shift in its sales strategy. Originally favoring a direct-to-consumer model, it opted for franchised dealerships in the United States, intending to establish 50 dealerships in the United States and Canada. This strategic pivot further impacted Fisker’s stock price, witnessing an 86.5% decline over the past 12 months.
Following the news of the NHTSA probe, Fisker’s stock dipped below $1/share, experiencing a 7.5% decline and reaching a 52-week low at $0.893/share in the latest trading session. The outcome of both the investigation and the revised sales strategy remains pivotal for Fisker’s future trajectory.