Coda, which joined the green car fraternity and introduced its vehicles to California consumers about one year ago, has filed for bankruptcy protection after selling only about 100 of its all-electric sedans.
The five-passenger Coda E.V., imported from China, had a range of 125 miles on a single charge. But the $37,250 vehicle was criticized for its no-frills styling. Its brief tenure also included a recall for faulty air bags.
According to Reuters, the bankruptcy filing with the federal Bankruptcy Court in Delaware will allow the Los Angeles company to leave the auto industry and refocus on energy storage. Coda 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 plans 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 was one of an emerging crop of California start-ups, including Fisker Automotive and Tesla Motors. All sough to build emission-free electric cars to appeal to mass-market consumers.
Investors poured money into the sector, and Coda raised $300 million in equity from backers, including Aeris Capital, the Limited Brands chief executive Les Wexner, and former Treasury Secretary Henry Paulson.
However, in 2012 the company withdrew its request for $334 million in federal loans like the ones Fisker and Tesla received.
As the allure of electric vehicles faded, Coda struggled to secure new private funding. Last year, Coda sought to raise $150 million but clinched just $22 million, according to a filing with the Securities and Exchange Commission.