Green car startup Coda Holdings filed for Chapter 11 bankruptcy protection Wednesday after selling just 100 of its all-electric sedans, another example of battery-powered vehicles’ failure to break into the mass market.
The filing with U.S. Bankruptcy Court in Delaware will allow the Los Angeles company to exit the auto sector and refocus on energy storage, a far less capital-intensive business. The company uses the same technology it used in cars to build systems for utilities and building operators to store power.
A group of lenders led by Fortress Investment Group plan to extend debtor-in-possession financing and will seek to acquire the company for $25 million through the bankruptcy process, Coda said in a statement.
Coda launched its five-passenger electric car in California a year ago, delivering a range of 125 miles on a single charge. The $37,250 vehicle was criticized for its no-frills styling, and its short history also included a recall due to faulty airbags.
Consumers have been slow to gravitate toward electric vehicles (EVs) as a result of their high cost, and fears about their driving range.
Just three years ago Coda was one of an emerging crop of California startups including Fisker Automotive and Tesla Motors seeking to build emission-free electric cars to appeal to mass-market consumers.