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Star car designer Henrik Fisker has driven another leg on his road to redemption. On Friday, his second-try electric car effort, Fisker Inc., merged with special purpose acquisition company Spartan Energy Acquisition Corp., raising $1 billion of much-needed funds in the process. In its first day of trading on the New York Stock Exchange under the symbol FSR, the stock climbed 13% to close at $10.14.
Fisker says that’s all the money he’ll need to bring his planned electric SUV, the Fisker Ocean, to market at a price under $40,000. Last month he struck a deal with Canadian auto manufacturing giant Magna International to supply key components of the vehicle, with mass production planned to start in about two years.
It’s quite a different strategy than what Fisker tried last time around. A decade ago, Fisker Automotive designed, manufactured, and sold the Fisker Karma hybrid electric sports car priced at over $100,000. It was an expensive flop, plagued by delays and quality issues, and the company ended up in bankruptcy.
The man who designed the Aston Martin DB9 and the BMW Z8 says he has learned his lesson. “You’ve got to give up your ego,” Fisker told me when I spoke to him this summer. “A lot of the hardware in vehicles is going to end up being a commodity, and therefore we are willing to share those parts with somebody else.” Like an EV version of Apple or Nike, the plan is to win over buyers with sharp looks and great design without needing to make every part itself. “Emotional design is going to be in the foreground of vehicle purchasing in the future,” he said. “We’re going to be the leader in that, both inside and outside and also the entire user interface.”
Sounds smart. On the other hand, Car and Driver magazine this month has a deep dive into the electric vehicle market and the news is not so good. Few consumers are interested in converting to EVs any time soon, the sticker prices of even the cheapest EVs are well above the price of entry-level gas-powered cars, and the big automakers don’t have the brand cache to attract the people who do want—and can afford—an EV. Beyond Tesla, no carmaker has had a major success with an electric car yet.
Then there’s the crowd of newcomers. Fisker is hardly the only EV startup to debut on the stock market this year. Two-year-old EV component maker Hyliion Holdings and EV truck maker Lordstown Motors (making a go at it in the famed General Motors Ohio factory) merged with SPACs to go public last month. Both also rose in their first day of trading but have since tumbled. Hyliion plunged 52% in a few weeks and Lordstown 31% in just a few days. Other EV stocks also had a terrible last week. Tesla lost 9%, controversial Nikola Motor fell 19%, and Workhorse Group plunged 24%.
Still, stock market machinations aside, Fisker says he has all the resources in place to bring the Ocean to market. It’s hard to root against him.
In the latest episode of our Fortune Reinvent podcast, Land O’Lakes SVP Heather Anfang explains how the agricultural cooperative dealt with the COVID-19 pandemic and resulting shocks to demand for its products.
Aaron Pressman
NEWSWORTHY
Pulling the plug. Maybe it wasn't as bad as the downdraft hitting stocks of electric vehicle makers, but tech stocks in general got crushed on Friday, as third quarter earnings reports failed to impress. Twitter dropped 21%, Spotify lost 10%, and Square fell 9%. Among the most valuable tech players, Apple lost 6%, Amazon lost 5%, Microsoft slipped 1%, and Google was the rare stock in the green, gaining 4%.
Counter-narrative. We have heard a lot from Republican senators alleging social networks like Twitter and Facebook are biased against conservative points of view. It's a false narrative, as the Nieman Lab reports on two studies disproving the charge and the Washington Post reveals Facebook in some cases ignored its own rules to give preferential treatment to pro-Trump groups.
Domo arigato Mr. Robotto. U.K. online grocer Ocado is stocking up on automation technology. The company agreed to pay $262 million for Kindred Systems, a San Francisco-based startup building warehouse robots, and $25 million for Haddington Dynamics, a Las Vegas firm specializing in robotic arms. For a real kick, check out the new form of robot (I guess it's still a robot) debuted by some Chinese researchers last week that reconfigures itself from a swarm of metal spheres. Called FreeBOT, the group of spheres motor about and stick together via magnets.
Run hard or leave the app. Not all mergers and acquisitions work out as planned, of course. Athletic wear giant Under Armour is selling exercise tracking app MyFitnessPal to Francisco Partners for $375 million, about $100 million less than it paid five years ago. It is keeping one bit of the platform, the MapMyFitness apps, however. Under Armour is also shutting down personal trainer app Endomondo, purchased five years ago for $85 million.
Nose painting your age. As we hurtle towards election day, the Trump administration faced another setback in its effort to curb the security threat slash teen app sensation TikTok. District Judge Wendy Beetlestone on Friday issued a temporary injunction forbidding Trump's TikTok ban from going into effect while the court battle continues.
FOOD FOR THOUGHT
Fortune reporter Katherine Dunn has been delving into the mysterious glitches plaguing the Global Positioning System, or GPS, for some years now. Over the weekend, she updated the story with the tale of the persistent GPS hole across huge stretches of the Mediterranean.
Although the outages are assumed to be a knock-on effect from conflict zones and militaries on the ground, their sheer scale means it's not clear who is responsible for all of the outages, according to experts. The leading assumptions from experts in the area is they come from military operations from multiple countries in the region, including airbases and vessels—in the East Mediterranean, one of the rare examples where public attribution has been made, such outages have been traced to an airbase on the coast of Syria. Berz says the fact that the outages are intermittent and not continuous, and therefore difficult to predict, makes it even harder to trace the disruptions to their exact source.
IN CASE YOU MISSED IT
Biden campaign slams Facebook for cutting off its political ads By Danielle Abril
Theft of $2.3M from GOP shows how campaigns are juicy targets for hackers By Jeff John Roberts
Apple starts selling its Apple One subscription bundles. Here’s how much they cost By Aaron Pressman
China’s new five-year plan has an ambitious aim: to become a self-sufficient, global tech superpower By Grady McGregor
The self-funded retail startup designing seasonless clothing for women By Rachel King
How a new regulation would let businesses avoid the law by classifying employees as independent contractors By Scott Casabona
The 5 best things I bought in October to make working and living at home easier By Rachel Schallom
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BEFORE YOU GO
Instead of paying humans to operate the cameras televising its matches, Scottish soccer team Inverness Caledonian Thistle FC installed an A.I. app called Pixellot that was supposed to keep the lenses trained on the ball. It all went horribly wrong last week when the bald head of a referee confused the system. I thought for sure this was a spoof but there's video proof. Don't get mixed about this week and don't forget to vote if you haven't already.