Electric Last Mile Solutions files for bankruptcy

The urban delivery van produced by Electric Last Mile Solutions. (Photo provided by Electric Last Mile Solutions)

After an internal review of previously announced production plans and potential obstacles to securing new financing, Electric Last Mile Solutions executives say filing for Chapter 7 bankruptcy is its best option.

The company, which has a strong presence in Mishawaka, reviewed its products and marketing plans and concentrated its workforce on production. Its review also included the feasibility of meeting previously announced production targets.

The bankruptcy filing follows a management restructuring in February. Shauna McIntyre, an automotive industry veteran, has been named CEO and interim president.

McIntyre said bankruptcy seemed like the best option after the company’s management determined there were too many hurdles for the company to face moving forward.

“I am very disappointed with this result as our ELMS team has shown incredible determination to prepare our electric vans to meet the critical need for clean, connected vehicles that reduce carbon emissions from ground transportation,” McIntyre said. “Unfortunately, there were too many hurdles to overcome in the short time we had.”

She said the electric vehicle technology used by ELMS remains viable.

“This is a viable and essential technology, and I am confident that many of our talented employees will play a future role in this energy transition effort,” McIntyre said.

McIntyre replaced James Taylor, CEO and Chairman. Jason Luo, chairman of the company’s board at the time, also resigned. Their resignations came after an investigation by an independent committee revealed potential violations of securities law.

The board determined during its investigation that it should withdraw its financial advice and state that the company’s past financial statements were unreliable. The results of the investigation, along with an ongoing investigation by the SEC, made it extremely difficult to find a new auditor and obtain additional funds, the company said.

The company said it continues to seek new funding, while working with advisers to assess and improve its liquidity position. But the board determined, after consulting with outside advisers, that it was in the best interests of the company, its shareholders, creditors and other interested parties to file for bankruptcy.

Brian Krzanich, chairman of the company’s board and former CEO of Intel, said that over the past several months, the ELMS board has been working to resolve financial, governance and operational issues.

“(Huge) progress has been made, including towards vehicle certification,” he said. “Therefore, it is extremely frustrating that we had to go this route, but it was the only responsible next step for our shareholders, partners, creditors and employees.”

Electric Last Mile Solutions is headquartered in Troy, Michigan. It has a manufacturing site in Mishawaka and additional sites in San Francisco and Shanghai, China.

Larry Avila
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