Henrik Fisker will rise at about 5am on Thursday to squeeze in a quick workout before making his way to a factory spanning the equivalent of more than 150 football fields. Hours later, camera crews will capture an unlikely milestone made possible by the blank-cheque boom: The first Ocean, Fisker’s debut electric vehicle, will roll off the assembly line.
The SUV zips from zero to 100km/h in as little as 3.6 seconds and is expected to offer up to 563km of range, a smidgen more than the Tesla Model Y. The hero feature inside: a 17.1-inch centre touchscreen that rotates at the press of a button for more enjoyable bingeing of YouTube videos and streaming services.
It will be hard for the shows and movies that air on the Ocean’s high-resolution screen to match the amount of drama that’s played out over Henrik Fisker’s 33-year career. There have been exhilarating highs — making a name for himself designing slick BMW and Aston Martin sports cars — and crushing lows, none more disappointing than when his first plug-in vehicle venture, Fisker Automotive, filed for bankruptcy nine years ago this month.
That blemish on his resume made funding a follow-on car business difficult, at least for a few years. He and his wife and co-founder, Geeta Gupta-Fisker, were forced to stop collecting cash compensation from Fisker and furlough employees right before the outbreak of Covid-19 was declared a pandemic in March 2020.
Then, something funny happened: ventures with little or no revenue began generating enormous buzz by merging with special-purpose acquisition companies and going public.
A month after electric-truck start-up Nikola made its stock market debut and briefly exceeded Ford’s valuation, Fisker agreed to combine with a SPAC sponsored by private equity giant Apollo Global Management Inc in a deal that left the carmaker flush with roughly $1bn (roughly R17,487,600,000) in cash. The Fiskers parlayed that sum and big-name backing into pacts with the auto industry’s most reputable contract manufacturer, Magna Steyr, and the world’s largest battery company, CATL.
Partnering with Magna Steyr — which will make Oceans alongside BMW Z4 and Toyota Supra roadsters, as well as BMW 5-Series sedans — greased the skids for setting up a supply chain from scratch in the midst of unprecedented disruptions. Its parent, Magna International Inc., makes components ranging from stamped-metal structures to advanced driver-assistance systems. Fisker also paid upfront for a dedicated battery cell line at CATL to lock in supply.
“We’ve been able to avoid mistakes that are only unavoidable if you know them, and I knew them,” Fisker said in an interview. “The experience that I had by having done this once before is invaluable.”
Investors are still treating Fisker the company as a wait-and-see stock, having been burnt by Nikola, whose founder was convicted of fraud last month, and other post-SPAC auto start-ups such as Lucid. EV maker Rivian, which staged an initial public offering a year ago, also has been plagued by shortages that keep forcing its factory to stop and go for days at time.
Fisker is going to start slow, delivering just 15 vehicles before year-end to Magna’s commercial fleet. It has forecast more than 300 Oceans will be produced in the first quarter, followed by more than 8,000 in the second quarter of next year, leaving about 80% of total annual output slated for the second half. If all goes to plan, 42,400 vehicles will be built.
Gupta-Fisker, the company’s COO and CEO, told reporters last week that Magna Steyr positions Fisker for a smoother ramp-up in production than what other EV start-ups have managed.
“Suppliers want to go to safe havens. They want to go to manufacturers that are not cancelling — they are consistent,” she said. “We don’t need to learn manufacturing. We don’t need to teach 1,000 people how to assemble a car. That risk is taken care of.”
Another factor in the company’s favour: Gupta-Fisker said its production costs for the first vehicle is the same as No 40,000, so Fisker won’t bear the expense of an underutilised factory for the first few quarters that Ocean is in production. Those costs have dragged on Lucid and Rivian’s earnings results, with both registering steep quarterly losses.
As for the product, early impressions of the Ocean are mostly promising, albeit guarded (Motor Trend punctuated the headline of its first-drive story with a question: “Finally a Success for Henrik?”) The CEO takes this sort of pondering in stride.
“I’m not here to prove something to people that don’t believe in me,” Fisker said. “I’m here to deliver what I think hopefully will be a product that people really will love.”
— More stories like this are available on bloomberg.com
