Fisker Inc (NYSE:FSR) stock was delisted from the New York Stock Exchange Tuesday, and Jim Cramer said another EV startup could suffer the same fate.
Fisker's Downward Spiral: In a regulatory filing released Monday, Fisker said the NYSE notified the company that it would immediately suspend trading of its common stock due to "abnormally low" trading price levels and commence proceedings to delist its stock.
Fisker said the delisting notice will trigger requirements to offer to repurchase its convertible senior notes due 2025 and 2026. The company noted that it does not have sufficient cash or financing to repurchase the notes and warned that the delisting event could have a material adverse effect on its business.
The news comes about a month after Fisker reported preliminary earnings results and issued a going concern warning. Recent reports also indicate that Fisker was exploring a potential sale of its business and had brought on restructuring advisers to help with a possible bankruptcy filing.
Fisker went public via SPAC deal in late 2020 when SPAC popularity was at its peak. Several other EV companies took similar routes to the public markets during that time and nearly all of them have underperformed the broader market since — some have even filed for bankruptcy.
Tuesday morning on CNBC's "Squawk On The Street," Cramer warned that another popular EV startup that went public via SPAC could soon follow in Fisker's footsteps.
"Fisker was delisted today, which is very important because I don't know how much staying power we'll see from Lucid," Cramer said. "I just don't think they have the sales that can keep them open."
Lucid Group Inc (NASDAQ:LCID) is another SPAC story, and it's arguably the most popular of all the EV startups that have gone public via SPAC in recent years.
Lucid announced last month that it delivered 6,001 vehicles in 2023 and produced 8,428 vehicles. The company guided for production of approximately 9,000 vehicles in 2024 and said it was "laser-focused" on growth.
On Monday, Lucid announced a $1-billion investment from Ayar, an affiliate of the Saudi Public Investment Fund. As of the end of the fourth quarter, the company had approximately $4.78 billion of total liquidity.
LCID Price Action: Lucid shares were down 4.1% at $2.80 at the time of publication, according to Benzinga Pro.
Photo: Owen Byrne from Flickr.