Down But Not Out, Henrik Fisker Is Back for Redemption

Fisker Ocean
Fisker Ocean is considered as the world's most sustainable vehicle with a base price of $37,499 USD.

Henrik Fisker, the Danish automotive designer and entrepreneur from Los Angeles is looking to take another run at the electrical vehicle space. Best known for designing luxury cars such as the BMW Z8, Aston Martin DB9, Aston Martin Vantage, Henrik is revving up his game once again with the new Fisker Ocean, dubbed as the world’s most sustainable vehicle.

Fisker Ocean

Round 2 for Henrik Fisker

The company initially debuted in 2008, the same time as Tesla with their eye popping Fisker Karma that started at more than $100,000. The luxurious hybrid electrical sedan was the first of its kind but sold fewer than 1800 units worldwide. In 2013, the company filed for bankruptcy with a lot of lessons learned. This experience encouraged Henrik to design a more versatile, affordable SUV, hence the Fisker Ocean which starts at a reasonable $40,000.

“This time we wanted to go directly to a volume segment where we can have a long-term business where you can actually make money,” he said, noting that while sedans have likely peaked, SUVs remain the fastest-growing market in the world. By 2022 more than 65% of new-vehicle sales will be trucks and SUVs. “It’s about partnering in the right places, not spending hundreds of millions where you don’t have to. Now I have this experience and lessons learned and have figured out what is the best way to do this.”

Fisker Karma $FSR
The Fisker Karma was a pioneer in the hybrid-electrical car market but could not keep up with Tesla.

Revenue for Fisker

As of October 29th, 2020, the company has stated that they have 9,000 reservations on the Ocean SUV with each deposit being at $250 USD. Although the company has no real revenues at the moment their balance sheet seems strong. According to the SEC report, as of September 30, 2020, Fisker’s cash and cash equivalents amounted to $45.0 million and its long-term debt amounted to $10.9 million. On a pro forma basis, upon stockholder approval and consummation of the Business Combination, company’s cash and cash equivalents amount to approximately $1,018 million at September 30, 2020, after redemptions by Spartan stockholders.

Relationship with Magna

The company has partnered with the Canadian auto parts maker Magna International to assemble the upcoming Ocean SUV. The vehicle will be build at Magna’s Graz, Austria plant. In addition, Magna has a six percent stake in Fisker which aligns the interest of the manufacturer with the interests of the company.

The company has partnered up with Canadian automotive parts maker, Magna International.

Debt Levels

Fisker mentioned that in addition to $1 billion in cash available on its balance sheet, they did indicate that they have no debt. They’ve stated that the amount is expected to fully fund the company’s operations and the development of the Fisker Ocean SUV through the planned start of production in Q4 2022.

Management Team

The management team is lead by CEO and pioneer Henrik Fisker who describes himself as synonymous with iconic cars and futuristic designs. That’s apparent with the smooth and sleek design of the Fisker Ocean.

Dr Burkhard Huhnke is the Chief Technology Officer and served as Vice President of Automotive at Synopsys Inc from 2018 to July 2020. Dr. Huhnke has several years of experience in the electrical vehicle space serving as the Senior Vice President of e-mobility at Volkswagen America and prior to that he was the General Manager of Eletronics Development.

The Chief Financial Officer is Dr. Geeta Gupta-Fisker who is responsible for operations, finance, planning, purchasing and supply chain management. Dr. Geeta has 20 years of experience in technology and finance and is a co-founder of Fisker.

For a more detailed in-depth management team breakdown, visit Fisker Inc.

Industry Space

The company is in the right industry space. With many states and countries looking to ban gasoline cars by 2030, the race to dominate the electrical car market is on as has been seen with the rise of Tesla’s stock price. In addition, China’s NIO has seen a dramatic increase in the value of its shares. Many consumers are re-thinking the purchase of gasoline powered cars and are looking into electrical vehicles as the upfront cost could favourly impact their wallets in the future.

To the Future

The bottom line is that Fisker is back for Round 2 but this time, they’re not going up against Elon Musk but also a number of respected electrical vehicle companies. The race to dominate the electrical car market is on and Henrik is back for redemption. How will he fare? Time will tell.

On the date of publication, we did not have (either directly or indirectly) any positions in the securities mentioned in this article. For more information, please contact us.