The British electric vehicle maker, once valued at $13 billion, found itself under bankruptcy protection after being delisted from the Nasdaq exchange, making no sales

The latest electric vehicle company to collapse is Arrival, a UK-based startup that has been operating for nearly a decade. The company announced that its UK division is entering administration (just like bankruptcy protection in the US) on Mondayjust every week after receiving notice from Nasdaq, the US technology-based index, that its trading could be suspended.

Arrival did not file its 2022 annual financial reports and failed to fulfill Nasdaq’s “continued listing standards,” resulting in its delisting, the company said in Press release.

Accounting firm EY-Parthenon will oversee the company’s administration process to explore “options for the sale of the business and assets”, including mental property and electric vehicle platforms, Financial Times. reported. The process may also potentially lead to the lack of 170 jobs at Arrival’s UK operations, but won’t impact its operations elsewhere in the world.

The British electric van maker, backed by Hyundai and BlackRock, was valued at $13 billion when it listed in 2021, in line with data. to Crunchbase. The launch of Arrival was a watershed moment for the UK’s electric vehicle ambitions, because it gave the impression to be a promising player in a very important – after which rapidly growing – market. For its part, it received orders for its delivery vehicles from Americans corporations like United Parcel Service and Uber, but never achieved mass production.

The company’s shares have fallen 99% since its public listing, leaving its current market valuation at $2.76 billion.

Building as much as going into administration

With the twin events of delisting from Nasdaq and entering administration, Arrival reflects lots of the uphill battles corporations face as they struggle to get a chunk of the electric vehicle pie.

The arrival struggled with rising costs because it required several hesitation restructuringincluding last 12 months’s layoffs of roughly 50% of its global workforce.

In 2022, it decided to focus more on the United States, hoping to money in on the Biden administration’s Inflation Reduction Act, which offered subsidies to business electric vehicle makers, which could prove to be a saving grace for Arrival’s turnaround. According to Arrival, the UK didn’t offer the same advantages at the time, which made it difficult to scale the business to Reuters.

The company was burning through its money, it said net losses of $1 billion in 2021 and 2022. While these charges were partly the results of the company’s restructuring efforts, it still had not achieved significant revenue at that point. In late 2022, the company warned that despite its efforts, it could soon run out of cash reduce costs.

Last May, Arrival reported a decline in money and money equivalents of nearly 40% over the 12 months three monthsraising the specter of the famous electric vehicle company not having enough resources to maintain the lights on.

Arrival managed to secure funding injections in 2023, including the loan amount 50 million dollars in November, which could keep the company afloat because it decides the way to operate.

Despite all the confusion, Arrival still embodied the UK’s dream of being a hub for electric vehicle manufacturers. But it wasn’t the only one which did not make this vision a reality – in January 2023, battery start-up Britishvolt went into administration on account of insufficient funds.

“Britishvolt has provided a significant opportunity to create jobs and employment, as well as support the development of the technology and infrastructure needed to help the UK’s energy transition,” Dan Hurd, one in all the administrators at EY-Parthenon appointed to the battery manufacturer’s case, said Fast marketsadding: “It is disappointing that the company has failed to achieve its ambitions and secure the capital financing necessary to continue operating.”

Several other electric vehicle start-ups have also recently collapsed, including Swedish truck maker Volta (which operates in the UK), which was unable to raise capital after the bankruptcy of battery supplier Proterra.

The UK remains to be trying pump hundreds of thousands in electric vehicle projects, and can be attracting investment from major automotive corporations resembling Nissan. However, it faces challenges in navigating post-Brexit regulations that significantly impact UK electric vehicles costlier sell in the EU.

The UK also lags behind in relation to offering incentives to electric vehicle users in comparison with European counterparts resembling Germany and France. This, combined with waning appetite for electric vehicles around the world, makes it difficult for the UK to turn out to be an electric vehicle superpower.