The Fisker bankruptcy was a significant setback for the electric car industry. Fisker Automotive, Inc. filed for Chapter 11 bankruptcy protection in November 2013.
The bankruptcy was caused by a combination of factors, including a recall of 239 of its luxury electric cars, the Karma, due to a fire risk. The recall was a major blow to the company.
Fisker's financial troubles were also exacerbated by a $529 million government loan that it struggled to repay. The loan was part of a larger effort to support the development of electric cars in the US.
The bankruptcy ultimately led to the sale of Fisker's assets to Wanxiang Group, a Chinese auto parts manufacturer.
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Fisker Bankruptcy
Fisker Automotive filed for bankruptcy in 2013, just two years after launching its first car, the Karma.
The company's financial woes were largely due to a combination of high production costs and low sales.
Fisker had invested heavily in its luxury electric vehicles, but the company's business model was unsustainable.
The Karma's price tag was around $103,000, making it a niche product that appealed to a limited market.
Fisker's bankruptcy filing was a major setback for the electric vehicle industry, which was still in its early stages at the time.
The company's assets were eventually sold to Wanxiang Group, a Chinese auto parts manufacturer.
Wanxiang Group rebranded Fisker as Karma Automotive and continued to develop the Karma model.
Fisker's bankruptcy served as a cautionary tale for other electric vehicle manufacturers, highlighting the importance of developing a sustainable business model.
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Fisker After Bankruptcy
More than 4,000 claims have been filed against Fisker, including two that total over $1 billion.
Buyers who purchased the premium electric SUV for as much as $60,000 are banding together to ensure they can get parts and service.
The bankruptcy plan has been approved, but Fisker still needs to sell its assets in Austria and intellectual property.
The proceeds from these sales will go into a trust, with the majority received by CVI Investments, a secured creditor owed over $180 million.
CVI Investments is an affiliate of Susquehanna International Group, a large trading firm founded by billionaire Jeff Yass.
Shareholders have sent letters to the court asking for an SEC inquiry into Fisker's dealings with CVI.
Car owners seeking compensation may have other avenues to recover funds, including filing arbitration cases against J.P. Morgan Chase Bank.
The law firm Hagens Berman is filing arbitration cases against J.P. Morgan Chase Bank on behalf of over 1,300 individual owners.
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