Fisker (NYSE:FSR) has revised its 2023 production guidance to 13,000 to 17,000 vehicles, a significant reduction from the initial projection of 20,000 to 23,000 vehicles. The move is attributed to challenges in ramping up deliveries, ensuring responsible inventory management, and effectively managing working capital. Fisker had previously cut its production forecast in August, citing delays from a key supplier.
The adjustment in production comes amid concerns about a potential slowdown in electric vehicle (EV) demand, echoed by industry leaders such as Tesla’s Elon Musk, who highlighted the impact of high interest rates on consumer sentiment. Fisker’s decision aligns with a broader trend, as luxury EV maker Lucid also recently reduced its production forecast in response to lower delivery numbers.
Fisker emphasized that the production cut is a strategic move for long-term sustainability, focusing on avoiding excess inventory. The company acknowledged that its supply chain has stabilized but expects occasional bottlenecks from certain suppliers.
CEO Henrik Fisker noted challenges in delivery and service infrastructure, limiting the company’s ability to meet demand promptly. The company is actively working on addressing these challenges by hiring additional staff, expanding logistics partnerships, and opening new facilities.
Despite the production adjustment, Fisker reported delivering 1,200 vehicles in October, surpassing the 1,097 deliveries in the third quarter. The company aims to accelerate deliveries by hiring more personnel and expanding its operational capabilities.
Fisker’s revenue for the third quarter was $71.8 million, falling below analysts’ expectations, accompanied by a larger-than-expected loss of $91 million. The company also disclosed material weaknesses in its internal control over financial reporting, citing complexities in accounting across multiple countries and areas such as convertible notes, derivatives, and inventory management in vehicle manufacturing. Fisker is taking steps to address these issues by hiring experts in the relevant fields. After the announcement, Fisker’s shares experienced a 14% decline in after-hours trading.
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