Fisker, the electric vehicle manufacturer, is experiencing a tumultuous time in the stock market. An upgrade and a National Highway Traffic Safety Administration (NHTSA) investigation regarding a braking issue with Fisker’s all-electric Ocean SUV have grabbed attention.
Upgrade Impact
CFRA analyst Garrett Nelson has recently upgraded Fisker shares from Sell to Hold. Despite lowering the price target to 75 cents per share from $1, Nelson’s analysis highlights the stock’s significant decline over the past few weeks.
Stock Struggles
Fisker stock has endured a rough patch, plummeting approximately 86% over the past three months. This decline can be attributed to various factors, including management changes, production challenges, and negative evaluations from Wall Street.
While this upgrade isn’t overly optimistic, any positive development can potentially boost a beaten-down stock. However, Fisker shares remain stagnant in premarket trading on Friday. On the other hand, S&P 500 and Nasdaq Composite futures show promising gains of 0.5% and 0.8%, respectively.
NHTSA Investigation
Adding to the stock’s volatility is the announcement of a possible probe by the NHTSA into complaints about the braking system of Fisker’s Ocean SUV. This development is being closely monitored by investors and analysts alike.
Fisker acknowledges the investigation and reassures its full cooperation with the NHTSA. Their Ocean brake system incorporates both friction braking and regenerative braking. Notably, regenerative braking allows the electric motor to decelerate the vehicle while simultaneously recharging the batteries, a common feature in electric vehicles.
Despite these challenges, Fisker remains committed to addressing these concerns and continuing its mission in the rapidly expanding electric vehicle industry.
Fisker Responds to Customer Feedback and Upgrades Software
Fisker, the renowned auto manufacturer, recently addressed customer concerns and released a significant software update aimed at enhancing the performance of its regenerative system. This update specifically improved the overall customer experience, especially when traveling over uneven terrain or encountering bumps along the way.
The Fisker Ocean brake system has been meticulously designed to meet and surpass both U.S. and international performance standards. This commitment to excellence ensures that customers can trust the safety and reliability of their vehicles.
It is worth noting that auto makers typically refrain from commenting on investigations carried out by the National Highway Traffic Safety Administration (NHTSA). However, Fisker’s open communication regarding this matter highlights their dedication to transparency and customer satisfaction.
NHTSA investigations are a routine part of the automobile industry. They are initiated following complaints, and if deemed necessary, they may result in recalls. While recalls can cause concern among consumers, they are an essential measure to address any potential safety issues. It is important to remember that numerous companies, producing millions of vehicles each year, encounter recalls in the United States.
In this particular case, NHTSA launched an investigation in response to nine complaints received. One reported crash and associated injury were mentioned in NHTSA’s Office of Defect Investigation report. Fisker has not yet faced any recalls; however, it is important to acknowledge that recalls can be a normal occurrence for emerging startups.
To provide some perspective, Rivian Automotive, another prominent startup, has already recalled around 40,000 units in the U.S. through eight separate recall campaigns. The largest of these recalls involved nearly 13,000 units and centered on rectifying a potential issue with the airbag deployment system.
Fisker has not yet responded to requests for further comments regarding their recent statement. Industry experts anticipate that both their statement and the software upgrade may impact trading activities and potentially introduce some volatility to Fisker stock on Friday.
It should be noted that Fisker shares are more susceptible to volatility compared to other stocks, as approximately 44% of the available shares for trading have been borrowed and sold short by investors who anticipate a decline in stock prices. This level of short interest is notably high, considering that the typical short interest for stocks in the S&P 500 hovers around 2%.
