Fisker says it’s worth more than $300 million in pre-orders for its electric SUV

Fisker Inc., a Los Angeles-based electric vehicle startup led by designer Henrik Fisker, says it has initial orders for a high-end version of the battery-powered Ocean SUV to go into production in November worth more than $300 million dollars.

Although the company is promoting a relatively affordable version of the Ocean, priced from $37,499 on its website, the first 5,000 orders are for the flagship Fisker Ocean One that will cost around $70,000 each, says Henrik Fisker. Forbes. Production of these units begins on November 17 in Graz, Austria, at a plant operated by automotive supplier Magna, its manufacturing partner. The lower-priced Oceans will be available by the end of 2023, he said. The company also said it has more than 56,000 total orders for the SUV.

“Right now we’re seeing higher income levels interested in EVs and early adopters. They go for the higher class vehicles. In 2024 we will see more leveling (in price) and more interest,” says Fisker. “Our whole business model is designed in a way that we want to target volume, which means we need that $37,500 car because that’s how we get the volume.”

Fisker is the latest entrant into the fast-growing US electric vehicle market, following last year’s launch by fellow startups Rivian and Lucid of EVs priced above $80,000. And although its first units will be expensive, Fisker’s strategy to close Tesla’s huge sales gap is to switch to more affordable models. It plans a cheaper version of the Ocean and a small utility vehicle called the PEAR that it will produce with electronics manufacturing giant Foxconn in Ohio in 2024. It shared few details about the PEAR, except that it will target younger buyers and have a base price $30,000.

Fisker Inc. is Henrik Fisker’s second attempt to challenge Tesla after his first, Fisker Automotive, failed in 2013 after only building a few thousand units of the $100,000 Karma plug-in hybrid luxury car. He co-founded the new company with his wife Geeta Gupta-Fisker, who is also chief operating officer and CFO.

(For more, see Meet the Fiskers, the Billionaire Power Couple Taking Over Tesla)

The company, which is not yet generating revenue, reported second-quarter results on Wednesday that were broadly in line with analysts’ expectations. Fisker’s net loss was $105.9 million for the quarter, and it used about $191 million for vehicle development work and other expenses ahead of the start of commercial operations later this year. The company said it had about $851 million on hand, enough to carry it through until Ocean begins production.

“Second quarter operating losses were lower than consensus, cash consumption was embedded,” Morgan Stanley equity analyst Adam Jonas said in a note. “Fisker ended Q2 with cash to sustain operations through the end of the year before testing cash lows…setting up for a volatile 2H.”

Fisker shares rose 5.8% to $10.41 on Wednesday ahead of the company’s earnings report. They were little changed in after-hours trading.