Two Coda affiliates filed for Chapter 11 bankruptcy protection

Article by Anita Panait, on June 13, 2013

Lio Energy Systems Holdings and Miles Electric Vehicles, affiliates of collapsed American electric car maker Coda Automotive, filed for Chapter 11 bankruptcy protection Tuesday. The green companies are seeking to have their cases jointly administered with those of parent Coda Holdings and its affiliates. One of the main reasons for the companies’ demise is the slow embrace of consumers in the United States on electric vehicles, mainly due to their high prices, insufficient charging infrastructure and worries with driving range.

These hurdles have made the green car market a more difficult place to succeed. Coda, which filed for bankruptcy on May 1, 2013, and its affiliates were not the only ones suffering this debacle. Another green carmaker Fisker Automotive Inc. might take a similar path after it was disclosed to be seeking a buyer after hiring bankruptcy advisers.

Large carmakers who have invested heavily in green cars like General Motors, Ford, Nissan and Honda are also feeling the heat of slow sales of electric vehicles.  Lio Energy Systems is described in court filings as a direct subsidiary of Coda Holdings, while Miles Electric Vehicles is a direct subsidiary of Lio Energy.

Lio Energy was created in 2009 as a joint venture between Coda and Lishen Power Battery to develop and provide lithium ion batteries for electric cars and utilities. Miles Electric Vehicles was established in 2004 by Miles Rubin, a co-founder and former chairman of Coda Automotive. Miles Electric was one of the first US firms to import small electric cars from China focused mainly on building low-speed vehicles. [source: automotive news - sub. required]

Topics: bankruptcy

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