Fisker announces 31,000 reservations for its Ocean SUV as production approaches – Techdoxx

Deepak Gupta February 17, 2022
Updated 2022/02/17 at 3:39 AM

Fisker is still on track to start production of the Ocean SUV in November, with bookings for its first electric vehicle jumping to 31,000, the company said Wednesday during its fourth-quarter and full-year earnings call.

The electric vehicle startup said production of prototypes has started at the Fisker Ocean assembly facility, which is operated by automotive manufacturer Magna Steyr’s plant in Graz, Austria. The facility will soon have the ability to produce two prototypes per day to support its testing and validation program for global certification.

There are 1,600 fleet reservations for Ocean, including an incremental order of 200 units from software company ServiceNow.

Unraveling the numbers in its earnings report, it appears the company has added around 6,000 bookings since the start of the year. Fisker recorded $6.3 million in deposits through the end of 2021. Given that it charges $250 for Ocean SUV deposits, the company likely had around 25,000 reservations at the end of 2021. Fisker reports the net daily rate of 2022 year-to-date retail bookings increased by over 400% over the last fiscal year and is on track to hit over 55,000.

Approximately 80% of ocean reserves came from North America, with the rest coming from Europe, according to CEO Henry Fisker, but the company expects that number to change when it launches in Europe. The company is going to Mobile World Congress next week in Barcelona to launch Ocean. Henrik Fisker said he expects Europe to account for 40% to 50% of total demand.

A survey of reservation holders conducted by the company in December 2021 showed that the majority, 81%, plan to buy one of the two top finishes, the Ocean Ultra, priced at $49,999, and the Ocean Extreme/One, priced at $49,999. US$68,999. This implies an average starting selling price of around $56,000 and that current bookings have an indicative value of future gross revenue of around $1.7 billion, based on over 30,000 bookings.

The lower-tier trim, the Ocean Sport, is priced at $37,499.

During the call, Fisker praised the company’s opportunity to own market share in the “sexy, sustainable” category, saying there are no other competitors selling affordable, beautiful, high-tech EVs, as most cars that hit the market, including some of Fisker’s, have much higher prices.

“I’m challenging you to find a sexy, high-tech electric vehicle for under $30,000,” Fisker said during the earnings call. “Now, with that in mind, think about what’s going to happen in the next two years. All this market share will be disputed. And if we have one vehicle among the few, we have the ability to have a much larger market share than we normally would if you had 50 competitors, and we don’t. All these competitors that everyone is talking about are coming out with $60,000, $70,000, $80,000 or more.”

While Fisker was primarily referring to the potential of his Pear, an electric crossover that opened for bookings on Tuesday with a starting price of $29,000, it’s clear from Fisker’s Ocean booking breakdown that current buyers are even more interested in pursuing the highest form of luxury. available on an EV.

That said, while Pear has only been open for bookings for a day, it already has 1,000 entries, according to Fisker.

The company has announced the completion of the concept phase of the Pear, which will be manufactured in partnership with Taiwanese electronics manufacturer Foxconn in Ohio with an expected annual volume of a minimum of 250,000 per year after full ramp-up.

“My goal is to produce over a million pears a year, sometime after 2025,” Fisker said. “Obviously this will require multiple factories on multiple continents. But I think this vehicle has the potential to be iconic globally. It was designed not to fit into one segment, but to fit into a future lifestyle.”

The CEO cited the company’s deal announced in the third quarter of last year with battery cell manufacturer CATL, which is expected to give Fisker an initial annual capacity of more than 5 gigawatt hours by 2025, with the potential to increase volumes.

Retail loans, warranties and powertrain development

Among other announcements during the earnings call, Fisker said it has named JPMorgan Chase in North America and Santander in Europe as its banking partners for retail point-of-sale lending to all of its customers.

“Our teams are now committed to fully architecting and integrating systems for a frictionless user journey, from the ordering process to creating the appraisal, financing and ownership experience,” said Dr. Geeta Gupta-Fisker, Co-Founder, Director Fisker’s Chief Operating Officer and Chief Financial Officer.

The company also announced that it has “green lighted” its powertrain development center in Southern California, which will focus on everything from package design to battery management system design.

“We have already built strong in-house capability in these areas, but we are building on that and providing the technology and tools needed to increase knowledge in this critical area,” said Gupta-Fisker. “The Center of Excellence will also be used for vehicle teardown benchmarking as well as root cause analysis.”

Fisker’s Finance

Fisker’s fourth-quarter net loss was $138.4 million, or $0.47 of loss per share, which is $0.01 higher than street expectations, by Yahoo Finance. Fourth-quarter loss increased from the prior quarter of $109.8 million, or $0.37, and a loss of $87.4 million, or $0.39 per share, in the same period last year. last year.

Fisker generated revenue of $41,000 in the fourth quarter – thanks to some merchandise sales – and $161,000 for the year. The annual cost of sales was $87,000.

As you would expect with a pre-revenue company trying to scale, it saw operating expenses hit $140.9 million in the fourth quarter, up 368% from the $30.1 million spent in the same period last year. Capital expenditure was $52.6 million in the fourth quarter, according to the document.

Operating losses totaled $133.4 million, an increase of about 22%. Similar to last quarter, Fisker is pouring money into R&D, spending $115 million in the fourth quarter, up from $99.3 million in the third quarter.

When we cut spending for the full year, Fisker spent $286.9 million on R&D, up from $21 million in 2020, a typical turnaround for a pre-revenue and pre-production company gearing up to sell equipped cars. with technology like ADAS system announced at CES with Magna.

As a result of such generous spending, Fisker’s cash supply has dropped slightly, from $1.4 billion in the last quarter to $1.2 billion in the fourth quarter, but that’s still plenty to play with as the company not much in terms of the long term. term debts. He has convertible notes, but they are likely to become equity over time.

The company says it has remained quite disciplined with spending and, as a result, has the resources to fund the launch of the Ocean program in November and stay on track with other projects in 2022. However, after the November ramp-up, Fisker is developing “a very robust working capital model” and is in “discussions with several major balance sheet banks to access asset-backed lines of credit to fund working capital needs on an undiluted basis,” Gupta-Fisker said.

The company is also counting on its access to industry-standard payment terms from many vendors and is open to fundraising again in public markets should it need to bolster its balance sheets further, according to Gupta-Fisker.

Fisker’s stock peaked at $14 a share after hours but settled at around $12.90 at the time of writing, up nearly 2% today.

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