Coda furloughs workers in new wave of cost cuts
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Executive Chairman Mac Heller marked the first customer delivery of CODA's electric vehicle at a dealership in Santa Clara, Calif., in March 2012. The company furloughed some employees Friday in another round of cost cuts. Photo credit: REUTERS |
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LOS ANGELES -- In another sign of Coda Automotive's financial woes, the assembler of Chinese-made electric vehicles furloughed employees Friday, its second round of cost-cutting in the last month.
It's unclear how many of privately held Coda's roughly 275 employees were affected. A Coda spokesman declined to say how many workers were furloughed, but said the furlough will last for about three months and affect employees in all departments.
The spokesman also said Coda CEO Phil Murtaugh is still leading the firm.
The move follows the early December layoff of about 50 employees, or about 15 percent of Coda's workforce at the time.
In a statement, Coda called today's furloughs "necessary" to "bolster its financing and better position the business going forward. The company has kept in place a sufficient number of staff to keep the company operational and remains committed to the continued development and distribution of its products."
The statement added that Coda would continue to service its four dealers and current Coda customers.
"While unfortunate, we are confident this temporary action will allow the company to strategically direct resources towards critical operations and put the company on a more sustainable path," Coda said in the statement.
Coda and some other electric-vehicle start-ups, along with their suppliers, notably battery makers, have struggled despite public and private funding designed to jumpstart demand for alternative-powered vehicles.
Coda assembles its electric sedan in Benecia, Calif., using powertrains and partly assembled vehicles made in China by its joint venture with Hafei Motor Co.
The vehicle is based on an old Mitsubishi platform.
Coda doesn't disclose sales figures, but just 32 units had been registered in California through August, according to Experian Automotive.
You can reach Ryan Beene at rbeene@crain.com. -- Follow Ryan on 
