Florida owners of rechargeable electric vehicles won’t be using charging stations made by the recipient of a nearly $100 million grant from the U.S. government. Ecotality Inc filed for Chapter 11 bankruptcy, the latest industry casualty from the public’s general lack of interest in electric cars. The San Francisco-based maker of recharging stations for the vehicles, along with five of its affiliates, announced it would be auctioning off its assets one month after the filing and asked the court that it be allowed to pay its employees and vendors.
Ecotality blamed what it called significant liquidity restraints and the consequent difficulty of obtaining long-term financing as reasons for the bankruptcy filing. The company said that the auction would maximize its remaining value to creditors and help the company avoid what it termed a fire-sale liquidation.
The company manufactured the Blink and Minit Charger brand systems for electric vehicles. The government had been warned by Ecotality that its $99.8 million 2009 loan might be included in a bankruptcy, this after low sales and a suspension of loan payments to the government. Consumer resistance to the high-priced vehicles and their restricted driving range was responsible for a string of green tech vehicle company failures in recent years. One electric car start-up filed for bankruptcy recently after selling just 100 electric sedans.
Big loans from the government and a flashy product are no guarantee that a Florida company won’t need to seek bankruptcy protection. Chapter 7 bankruptcy and Chapter 13 bankruptcy are options for individuals and businesses to get out from under overwhelming credit card debt or seek other debt relief. An attorney experienced in consumer bankruptcy and business bankruptcy may be of assistance to those facing insurmountable medical bills or home foreclosure.
Source: Reuters, “Ecotality, an electric car charger maker, files for bankruptcy“, Jonathan Stempel, September 17, 2013