Fisker (FSR), responding to reports that it’s moving toward a bankruptcy filing, said it’s in “strategic” talks with a big automaker. FSR stock soared late after losing more than half of its value Thursday.

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Fisker stock dived 52% to 15.5 cents on Thursday after The Wall Street Journal reported the U.S. EV startup and would-be Tesla rival had hired restructuring advisors to aid in a possible bankruptcy filing

After the close, Fisker said it doesn’t normally comment on “market rumors and speculation,” but said it “often” works with outside advisers.

Further, “Fisker is focused on raising additional capital and engaging in a strategic partnership with a large automaker,” the EV maker said.

Of course, there’s no guarantee that such talks will bear fruit.

The EV startup last month said it could run out of cash this year, issuing a “going concern” warning. In late February, Fisker delayed full 2023 financial results, saying it lacked sufficient accountants.

Fisker has struggled with stalling EV demand and ongoing production hurdles facing many EV startups. In June, Fisker finally began U.S. deliveries of its first EV, the Ocean SUV.

Fisker stock surged 43% to 22 cents a share overnight, regaining a portion of Thursday’s loss.

EV Startup Woes

Tesla CEO Elon Musk recently commented that Rivian Automotive (RIVN) could go bankrupt in six quarters. Rivian production and deliveries are much stronger than Fisker’s, but its 2024 output guidance underwhelmed and it put a planned Georgia factory on hold.

Luxury EV maker Lucid Motor (LCID) recently slashed 2024 production guidance well below views, amid weak demand and prices.

Tesla is profitable and an EV giant, but profits have been sliding with deliveries expected to fall sharply in Q1 vs. Q4, despite ongoing price cuts and incentives worldwide.

Rivian stock slumped 8.7% to 10.69 on Thursday, a fourth straight decline after bouncing from record lows recently. Shares climbed 3% in late trade, aided by a Piper Sandler upgrade of RIVN stock.

Lucid stock sank 6.1% to 2.66 on Thursday. Shares rose 1.5% overnight.

Tesla stock fell 4.1% on Thursday to 162.47, a 10-month low. Shares edged higher late. TSLA stock has tumbled nearly 35% in 2024, making it the worst performer on the S&P 500 index.

Before Wednesday’s open Wells Fargo downgraded the EV giant to sell. Late Wednesday, UBS cut its Tesla price target to 165 from 225. Both joined other analysts it slashing first-quarter delivery targets and full-year profit estimates.

Please follow Ed Carson on Threads at @edcarson1971 and X/Twitter at @IBD_ECarson for stock market updates and more.

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