VROOM BOOM Three major electric vehicle companies declare bankruptcy racking up millions in debt and customers are being blamed
By Ben Shimkus
VROOM BOOM Three major electric vehicle companies declare bankruptcy racking up millions in debt and customers are being blamed
Published: 16:28 ET, Oct 14 2023Updated: 10:37 ET, Oct 15 2023
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ELECTRIC vehicles (EVs) have started to take over the vehicle market, but three EV companies have filed for bankruptcy this year as they failed to capture enough sales.
The three EV companies declared bankruptcy this year as other competitors captured the growing market.
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Three EV companies - including IndiEV - declared bankruptcy this yearCredit: INDIEV
IndieEV, Lordstown Motors, and WM all declared bankruptcy this year.
Each company lagged in sales and production as other EV startups grew their factory capacity and became increasingly popular.
Tesla, the biggest EV manufacturer, is the most valuable car manufacturers in the world at over $580 billion, according to U.S. News.
EV truck startup Rivian just hit records for production, while Fisker released its first production models.
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The three bankrupt companies had very different routes to their Chapter 11 declaration.
While none of the company's paths indicate the advancing pathway to EV adoption, their roadmap to bankruptcy tells three distinct stories about electric vehicle startups.
Here is more on each companies Chapter 11 proceedings:
1. LORDSTOWN MOTORS
Lordstown Motors, an EV manufacturer specializing in trucks, declared bankruptcy in June.
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The company took its name from the city where it took over a GM factory.
The Lordstown, Ohio factory produced General Motors vehicles from 1966 to March 2019.
The truck manufacturer's products earned praise from then-President Donald Trump as "a great technology."
But short sellers alleged in Hindenburg Research that executives inflated the company's assurances of its sales in an attempt to make money before selling off stocks.
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2. INDIEV
IndiEV recently bought contracts to build its cars in the same Lordstown factory - but a recent Chapter 11 put those plans on ice.
IndiEV teased the tech-based Indi One, its flagship vehicle set to start at $45,000, since 2021.
The car featured high-tech components, making it the "first vehicle to have an integrated supercomputer," according to statements from the company.
A supercomputer was supposed to give drivers access to onboard video games and entertainment applications.
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But the company racked up $26.43 million in debt and only $2.83 million in assets.
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3. WM MOTORS
A third electric vehicle startup, WM Motors, declared bankruptcy in October.
The company pointed to lackluster sales numbers as the reason for the declaration.
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The China-based company was working on plans to sell to Kaixin Auto Holdings in September, but couldn't reach a deal.