EV Maker Coda Files for Bankruptcy

Coda Holdings Inc., the parent of electric vehicle startup Coda Automotive Inc., has filed for Chapter 11 protection from creditors. The Santa Monica, Calif.-based EV maker sold fewer than 100 Coda sedans in the 14 months they were on the market.

Coda Holdings aims to liquidate its EV business and focus on its energy storage operations. Two-year-old Coda Energy uses the same technology that powers Coda EVs.

A consortium of lenders led by Fortress Investment Group LLC will provide $5 million in financing to keep Coda Energy afloat while in Chapter 11. The Fortress group has offered to buy those assets for $25 million during the bankruptcy. Its offer will serve as a starting point for a court-supervised auction. Coda says it expects to complete that sale within 45 days.

Coda Automotive began assembling the $38,100 sedan early last year at a plant in Benicia, Calif., by installing an electric powertrain in cars supplied from China by Hafei Automotive Group. CEO Phil Murtaugh predicted the company would achieve annual volume of 10,000 units in its first full year of production.

Coda raised $344 million in capital since its founding in 2009 from such investors as billionaire Philip Falcone and former Treasury Secretary Henry Paulson. The company applied for but did not receive a $334 million loan from the Dept. of Energy.

Coda had been trying to raise $500 million in fresh capital. Its bankruptcy filing lists assets of as much as $50 million and debt of about $100 million.