Fisker scales back production to divert cash for working capital

FILE PHOTO: The logo of Fisker Automotive is pictured on a car at the 2022 Paris Auto Show in Paris, France, October 18, 2022. REUTERS/Stephane Mahe/File Photo

(Reuters) -Electric-vehicle maker Fisker said on Friday it will scale down production this month and produce lesser cars this year than its previous guidance, to prioritize cash for working capital needs.

Shares of the EV maker, which has been struggling with a cash crunch, rose 7% in premarket.

"Fisker has made a strategic decision to reduce December production to prioritize liquidity to unlock over $300 million of working capital," the company said.

Fisker cut its production target for the year - at least a second time - to just over 10,000 units, compared with its earlier forecast of 13,000 to 17,000.

The company said it delivered 123 vehicles on Thursday, adding it plans to accelerates sale and deliveries despite the tough market conditions for EVs.

Some EV firms are facing dwindling cash reserves, pressured by high costs related to production ramp-ups and inflation and price cuts by rivals such Tesla.

In its most recent financial results, which were filed after a delay due to the departure of its former accounting chief, Fisker reported a loss of $91 million and revenue of $71.8 million for the third quarter, both missing expectations.

(Reporting by Yuvraj Malik in Bengaluru; Editing by Sriraj Kalluvila and Krishna Chandra Eluri)

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