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EV Manufacturer Green Vehicles Files for Bankruptcy

Steve Puma | Monday July 25th, 2011 | 1 Comment

Green Vehicles Triac 2.0According to the Monterey County Weekly and Examiner.com, electric car startup Green Vehicles has closed its doors, only months after announcing a partnership with Leyden Energy, and relocating to Salinas, CA, from their headquarters in San Jose. The failure of Green Vehicles is a major setback for Salinas, which seeks to position itself as a manufacturing hub for the Valley’s emerging cleantech industry. The city stands to loose at least $235,000 in incentives paid to the company, and is seeking to have those monies repaid.

Apparently, Green Vehicles has been having severe cash flow problems for some time. This, in spite of the fact that the California Energy Commission (“CEC”) had awarded the company a $2.1 million grant, and “had ranked the company as the top applicant, among 23 start-up competitors, in 2010.” [Disclosure: SABA Motors, employer of this author, was one of the 23 start-up applicants, who competed for the same grant money that was awarded to Green Vehicles, under the California Energy Commission's Alternative and Renewable Fuel & Vehicle Technology Program (AB 118). SABA Motors was not a grant recipient.]

In April, the Weekly obtained Salinas city emails and was first to report that the company was months in arrears and trying to barter a car for what it owed. Once word of the Weekly article reached Leyden Energy’s executives, that company pulled out of its agreement with Green Vehicles.

Some, including Salinas mayor Dennis Donahue, have criticized the CEC’s payment mechanism as a key factor in the company’s demise: the agency does not pay out grant awards as a lump sum, but rather reimburses companies as they incur expenses.

The CEC, and others, have countered that Green Vehicles had not been following the proper procedures for reimbursement. The CEC also notes that grant funding is not intended to be the sole mechanism for keeping a startup afloat, but, rather, is way to assist companies in securing other investment. The CEC stipulates that awardees must secure private matching funds, equal to the award amount. “What it does is help raise other dollars,” says Commission spokesman Adam Gottleib. “An Energy Commission grant is really a badge of honor.”

Green Vehicles President Mike Ryan, on the company’s blog, was eloquent in explaining his disappointment at the situation:

The truth is that not realizing the vision for this company is a huge disappointment. Our dream was to change transportation for “regular people” to something practical, sustainable, affordable, and cool. We aspired to be the fast-moving vehicle platform for innovations from a space in high flux: the deliberate first mover. I believed, and still believe, that with resources we could deliver a lighter weight electric vehicle, purpose-built for the daily drive…that we could lead the charge into the full benefits of a connected vehicle…and that in doing so, we could bring incredible value to consumers whose needs have been so narrowly represented by the incumbent automakers.

Green Vehicles was slated to produce two EVs: the Triac, a three-wheeled, “commuter vehicle,” designed for highway use, and the Moose, a small, van-like, “Neighborhood Electric Vehicle,” limited to 35mph. The company was founded by Ehab Youssef and Mike Ryan, whose previous venture, a ZAP EV dealership, failed when the ZAP turned out to be more hype than reality.

Although Monterrey County Weekly writer Mary Duan was merciless in her assessment that Green Vehicles was doomed from the start, it’s still sad to see yet another start-up in the alternative-fuel vehicle space, meet with such an ignoble end.

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Steve Puma is the Director of Business Development for SABA Motors, and a sustainability writer/consultant. His work focuses (mostly) on clean transportation, including Plug-In Electric Vehicles, something he is very passionate about.

Steve holds an MBA in Sustainable Management from Presidio Graduate School. You can learn more about Steve by reading his blog, or following his tweets.


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  • Takeanotherlook

    Are they filing for Chapter 7Liquidation or Filing Chapter 11 Reorganization? Are they selling their patents? Are they looking to be purchased in Bankruptcy?