Fisker's bid to sell off Ocean inventory in jeopardy

Fisker is looking to sell off the remainder of its electric vehicle stock for as little as $14,000 per unit after declaring bankruptcy in June.

Courtroom drama:

The Delaware bankruptcy is currently weighing whether to grant Fisker’s request. If approved, the now-defunct EV brand’s entire inventory of 3,231 Ocean SUVs would be sold for a rough total of $46.25 million. A New York car lease firm, American Lease, has already agreed to purchase the fleet.

Although Fisker is obligated to sell its assets as part of its bankruptcy proceedings, the judge may choose to deny the company’s request. In a previous hearing, attorneys representing the automaker’s creditors shared concerns that the revenue generated by the deal would never make it into the hands of lenders, who are owed roughly $1 billion.

However, Fisker’s own lawyers have urged the court to at least approve an initial sale of 200 EVs (worth $2.8 million) to the leasing company by July 12, noting that, without additional cash, the company would “be unable to fund vital business expenses…necessary to effectuate an orderly liquidation.”

The sense of urgency was met with confusion by the court and by lawyers from the U.S. Trustee office, U.S. Bank, and the Fisker Owners Association. Fisker has yet to provide a clear picture of its finances, making it difficult to verify the claim that it won’t be able to meet its obligations, including payroll.

What happens to the Ocean SUV?

• As part of its agreement with Fisker, American Lease will pay anywhere from $2,500 to $16,500 for each Ocean SUV, depending on the vehicle’s condition. The firm will also be granted access to the EV maker’s source code, allowing them to update the vehicle’s software.

• Other Fisker owners won’t be as lucky, however. Without software support from their manufacturer, the remaining Ocean SUVs will eventually cease functioning.

Bottom line: While Fisker’s collapse was guaranteed to be dramatic, the story serves to underline the risks of investing in or purchasing from an EV startup.

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