Coda lays off 50 employees amid sluggish sales of EV
LOS ANGELES – Coda Automotive, the struggling producer of Chinese-made electric vehicles, has laid off about 50 employees.
The layoffs, representing about 15 percent of Coda's workforce, affected employees from all areas of the company, Forrest Beanum, Coda's senior vice president of government relations and external affairs, said in a statement.
He characterized the cuts made last Friday as a "right-sizing" of the company.
CEO Phil Murtaugh, in a statement, said Coda is "realigning and streamlining the company to better position it to move forward on all fronts."
A company source, who asked not to be identified, said key engineers who had been working on Coda's next vehicle were among those affected by the cuts.
PlugInCars.com, a green car blog, reported the layoffs earlier Tuesday.
The layoffs suggest that Coda is facing a cash crunch amid sluggish demand for its $38,000 electric sedan, which is assembled in California from powertrains and vehicle gliders manufactured in China.
Coda doesn't disclose sales figures, but just 32 units had been registered in California through Aug. 31, according to data from Experian Automotive.
In September, Murtaugh told Automotive News that the company was working to raise additional funding from existing investors and attract new investors to fulfill its $150 million 2012 equity offering.
According to its most recent filing with the U.S. Securities and Exchange Commission in February, Coda had only raised $21.5 million of the $150 million fundraising target.
The company has said it has raised more since, but has declined to elaborate.
Coda suffered another recent setback when its sedan earned just a two-star frontal crash test rating out of a possible five stars from the National Highway Traffic Safety Administration.
The 2012 model year Coda also won five-star side crash and rollover ratings from safety administrators, giving the vehicle an overall rating of four stars.
Development has been underway on Coda's second-generation electric vehicle while executives plot an expansion of its U.S. auto retail network, an effort which also appears to be stalled.
The company had planned to open 10 new dealerships by the end of 2012 and as many as 40 by next summer, and had 25 letters of intent from dealers to open new stores. No new dealerships have been opened thus far.
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