Electric car startup Coda Holdings Inc. filed for Chapter 11 bankruptcy protection and will seek to sell its assets to a group led by a Fortress Investment Group LLC (FIG) unit.
Coda said that the process is intended to enable the company to complete a sale, confirm a plan and emerge from bankruptcy in a stronger position to execute its new business plan. The company expects the sale process to take 45 days to complete.
The filing with U.S. Bankruptcy Court in Delaware will allow the company to exit the auto sector and refocus on energy storage, a far less capital-intensive business. The company uses the same technology it used in cars to build systems for utilities and building operators to store power.
Coda launched its five-passenger electric sedan in California a year ago, delivering a range of 125 miles on a single charge. The $37,250 Coda electric sedan was criticized for its no-frills styling, and its short history also included a recall due to faulty airbags.
Just three years ago Coda was one of an emerging crop of California startups including Fisker Automotive and Tesla Motors seeking to build emission-free electric cars to appeal to mass-market consumers.
Tesla has put thousands of cars on the road, but Fisker is considering a bankruptcy filing. Fisker’s lithium-ion battery maker, A123 Systems Inc., filed for bankruptcy late last year.
