Despite seemingly being the way of the future, the electric vehicle industry is not an easy one. Take everybody’s darling until recently, Rivian. Ford had cut its stake in the company to just 1.15%, while Amazon, which continues to hold on to its stake, had to report its first annual loss since 2014 because of Rivian’s stock performance. Rivian is not the only struggling EV automaker, and others have completely failed.
To find failed and struggling American electric vehicle companies, 24/7 Wall St. scoured financial and automotive media. We aimed to select some well-known failed EV manufacturers and some of the most struggling EV car companies based on recent news and stock performance and stock price (less than $3 per share) as of Feb. 6. The companies are listed alphabetically.
Sales of low-emission vehicles, including both all-electric and plug-in hybrid cars, doubled from 308,000 in 2020 to 608,000 in 2021, according to the U.S. Department of Energy. A report from Kelley Blue Book reveals that while overall car sales slumped by 8% in 2022, purchases of electric vehicles soared by 65%. Cox Automotive, Kelley Blue Book’s parent company, forecasts 1 million EV sales in the U.S. for the first time in 2023. The U.S. government is getting behind the EV movement, aiming to have half of all new cars sold in 2030 be electric vehicles or plug-in.
Given growing sales and government support, many EV startups have found an eager investor pool. Yet some of these companies have struggled to get on the road due to fiscal shortfalls and internal turmoil, which often led to bankruptcies. Missed deadlines and low production often meant these companies struggled to get more financing. Shady practices by some top execs at these companies did not help the cause. (Also see, America’s favorite pickup trucks.)
Several companies on this list went public through special purpose acquisition company mergers. SPAC deals allow investors in an industry to raise capital through an initial public offering for the purpose of then merging with a private company and taking it public. But the SPAC deals that fueled the EV market in 2020 and 2021 have fizzled as investors have become more wary following years of new SPAC-backed startups failing to deliver on their promises, and as the Securities and Exchange Commission has investigated these deals. Several such companies have gone bankrupt or are struggling.
Though many large automakers often invest in the smaller startups, they also develop their own EVs. (Here are the most efficient cars on the market.)
Interestingly, EVs are not a modern phenomenon. Several automakers turned out a few EVs at the turn of the 20th century. Baker Motor Vehicle Co. rolled out its electric Baker Electric in 1899. One of its first buyers was Thomas Edison. Even Studebaker – a name now synonymous with old-fashioned, boxy autos – produced an electric car in 1902.