Fisker, the California-based electric vehicle (EV) company, revealed a pivotal shift in its business strategy on Thursday, outlining its intention to augment its sales and delivery network by incorporating traditional dealerships alongside its existing direct-to-customer distribution model. The move comes as Fisker aims to overcome distribution constraints and expand its market presence, particularly in North America and Europe.
Current Distribution Model and Challenges:
Fisker currently operates with a direct-to-customer distribution model, showcasing its electric vehicles through two Fisker Lounges in North America – one in Los Angeles and another in New York. Additionally, it utilizes retail stores known as Fisker Center+ in various locations. However, the limited physical presence has posed challenges in reaching a broader customer base and achieving efficient vehicle deliveries.
In 2023, despite manufacturing over 10,000 vehicles, Fisker faced distribution constraints that led to the delivery of approximately 4,700 units of its Ocean sport utility vehicles. Recognizing the need for a more expansive and accessible network, Fisker is strategically transitioning its approach.
Expansion Plans for North America and Europe:
To address these challenges, Fisker is set to adopt a dual strategy. In North America, the company plans to add up to 50 dealership partners, augmenting its existing showrooms and retail stores. This expansion aims to enhance the brand’s accessibility and streamline the delivery process for customers. Fisker is currently in discussions with potential dealer partners, with plans to dispatch its first Ocean vehicles to these new dealerships by the end of the first quarter.
In Europe, Fisker will maintain its direct sales approach but intends to collaborate with local partners for sales and distribution. This signifies a strategic adaptation to regional market dynamics and consumer preferences in Europe.
Strategic Evolution and CEO’s Perspective:
Fisker’s decision to incorporate traditional dealerships reflects the company’s evolving business model. Henrik Fisker, CEO of Fisker Inc., emphasized the strategic shift, stating, “We are evolving our business model and intend to add as many as 50 dealer partners in the US and Canada and a similar number of dealer locations in Europe this year.” This evolution aims to align Fisker’s distribution strategy with the diverse and evolving demands of the electric vehicle market.
Industry Trends and Comparison with Competitors:
The move to expand the dealership network positions Fisker alongside industry trends and competitors. Lucid, Rivian, and Fisker itself have previously adopted an online and direct-to-consumer model, inspired by Tesla’s success in eliminating traditional dealership models. However, the current shift underscores the recognition that a diversified approach, including traditional dealerships, can enhance market reach and provide a more robust customer experience.
VinFast Auto, a Vietnamese electric car manufacturer, recently embraced a dealership model by signing agreements for its first five dealerships in key locations across the United States. Similarly, Polestar, a Swedish EV maker, has opted for a dealership-oriented strategy.
Fisker’s strategic decision to expand its dealership network signifies a crucial step in adapting to market demands and overcoming distribution challenges. As the company navigates the dynamic landscape of the electric vehicle market, the incorporation of traditional dealerships alongside its existing distribution model reflects a commitment to providing a comprehensive and accessible experience for customers. The success of this strategic evolution will likely play a pivotal role in Fisker’s ability to capitalize on the growing demand for electric vehicles and solidify its position in the competitive automotive industry.
