Fisker eyes U.S. ocean production as part of electric vehicle tax credit shake-up

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Fisker Inc., a Los Angeles-based electric vehicle startup that plans to deliver European-built SUVs at the end of this year, plans to add a US production site for its Ocean model now that credits changes have been made. federal tax for electric vehicles granted to car buyers favor those assembled at domestic plants.

Fisker’s Ocean SUV is set to go into production in November at a factory in Graz, Austria, operated by auto parts and engineering giant Magna, which can supply 50,000 units a year. But with reservations for the model now exceeding 58,000 units before deliveries begin, Fisker says it may also need a US production base for future demand. The company insists the loss of tax credits for its customers under the Cut Inflation Act signed into law by President Joe Biden this week is not a trigger for the decision.

“We had already considered American-made for the ocean before the law,” Fisker CEO and co-founder Henrik Fisker said via email. “Once you hit over 50,000 sales in a region, local production really comes into its own. I predict that we should exceed 50,000 sales in 2024 in the American market. »

Until this week, every new electric vehicle was eligible for a $7,500 tax credit under an Obama-era program, regardless of where it was built, with a limit. than 200,000 vehicles per manufacturer. Companies such as Tesla and General Motors have long since exhausted their credit and were no longer receiving it, but startups such as Fisker, Rivian and Lucid had hoped to take advantage of the program. As of this week, the credit is only available for vehicles assembled in the United States. Plus, it’s only available for SUVs and other light trucks priced under $80,000 and cars that cost no more than $55,000. Additionally, only families with a maximum gross income of $300,000 or individuals earning up to $150,000 are now eligible for the credit, which is available at the time of purchase.

The Fisker Ocean is intended to be one of the most affordable electric vehicles on the market, with a base price of around $37,500, with higher-end versions costing upwards of $70,000. The company also plans to sell the model across Europe, but expects the bulk of its sales to come from the United States. In addition to working with Magna, Fisker’s second model, the under $30,000 Pear, is to be built in an operated Ohio factory. by Foxconn from 2024.

If the Ocean were to qualify for the tax credit, it would be one of the cheapest electric SUVs on the market, with an effective base price of around $30,000. General Motors, which will be eligible for tax credits again next year, plans to start selling an electric version of its small Equinox SUV in 2023 starting at around $30,000. This model must be built in the United States and should become even more affordable after the $7,500 credit.

Fisker uses contract production rather than building its own factories. Henrik Fisker declined to say whether Magna or Foxconn would likely be his US partners for the Ocean.

“We have not decided or released information on the details surrounding potential manufacturing operations in the United States,” he said. “Our senior vice president of manufacturing is working on the strategy right now.”

The company said last month it had sold the first 5,000 units of its Fisker Ocean One, the version that will go into production in November, and now expects to have 80,000 reservations for all grades of the five-car vehicle. passengers by the end of the year.

Fisker shares fell 2.4% to $8.93 in New York on Friday.

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