Fisker stock alert: Fisker recalls 18,000 Ocean electric vehicles

After a very volatile month Fisherman (OTCQB:FSRN) is facing new problems. The electric vehicle (EV) startup just announced a recall of more than 18,000 Fisker Ocean models due to software issues.

Fisker stock has proved volatile today following news that the electric car maker is voluntarily recalling those electric cars. Moreover, the recalls are raising questions about the future of the already unstable company, as well as its ability to continue operations as the list of concerns continues to grow.

What happens to Fisker shares?

It’s been a rough week for Fisker stock so far. At the time of writing, shares are down 0.85%. Although FSRN has surged over the past month on the back of Roaring Kitty’s rally, it has fallen significantly since then and looks set to continue paring its gains.

Now the vehicle recalls are casting further doubt on the company’s future. Admittedly, the recalls will not demand much from Fisker drivers, as the problems can be resolved via over-the-air (OTA) solutions. According to AutoBlogthe cars are also not being recalled for anything that could lead to accidents or deaths. The outlet reports:

“In the case of the Ocean, the recall notes that the font size of the brake, park and ABS warning indicators was too small, the brake warning lights were yellow rather than red, and some of the tire pressure warning lights were not working properly. This sounds petty, and it is not surprising that no injuries or damage occurred as a result of this problem, but the regulations are designed to ensure that the warnings are universally understood and that they are in colors and sizes that are easy to read and understand.”

For a more stable company, this recall would probably not play a major role. For example, Tesla (NASDAQ:TSL) has issued several recalls in recent years, none of which have really impacted shares. But Fisker is far from being Tesla — or even one of its much smaller EV competitors. Shares have fallen more than 96% in the past six months and are currently trading at about 4 cents per share. This follows several price increases sparked by news about dealer partners.

Given the clear lack of stability, it’s not surprising that Fisker stock is volatile following today’s news. The company has reported many negative catalysts recently, including defaulting on a $3.5 million loan and another wave of layoffs. Today’s recall probably won’t matter too much in the long run, but that’s only because Fisker has many other downsides.

On penny stocks and low-volume stocks:With very few exceptions, InvestorPlace does not publish commentary on companies that have a market capitalization of less than $100 million or that trade fewer than 100,000 shares per day. That’s because these “penny stocks” are often a playground for fraudsters and market manipulators. If we ever publish commentary on a low-volume stock that may be affected by our commentary, we require that InvestorPlace.com writers disclose that fact and warn readers of the risks.

Read more: Penny Stocks – How to Make Profits Without Being Scammed

At the time of publication, Samuel O’Brient did not hold (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the author and are subject to InvestorPlace.com’s disclosure policies.