The failed solar car manufacturer Sono Motors applied for the opening of insolvency proceedings in self-administration at the Munich District Court on Monday. Business operations will continue as part of this so-called protective shield procedure, the company announced on Monday in Munich. The startup cannot repay the reservation fees of thousands of customers as announced.
Sono Motors started developing a solar-powered small car in 2017 and presented a prototype of the “Sion”. Initially, the car should go into series production in 2019, after a few financing rounds and problems as well as a successful IPO in November 2021, it was finally 2024. The Sion should cost 30,000 euros.
Shattered dream of a solar car
But in February the dream of a Munich solar car was shattered. Sono Motors stopped developing after the conditions for financing had changed on the capital market in view of rising interest rates. 250 employees had to go. The company wanted to reposition itself as a supplier of solar technology for other vehicle manufacturers.
Over the years, the Munich-based company has been able to take thousands of pre-orders, with customers making down payments or paying for the car in full in advance. In February, there was talk of more than 45,000 reservations and pre-orders for which the company wanted to repay the deposits. For this, it proposed a repayment plan in installments over two years. The first installment should be paid in May.
Pending Repayments
Apparently, this repayment plan has now brought the company into financial distress. The additional funds required for the repayment “were initially promised by a financier,” the company said.
“However, in connection with the insolvency of the Silicon Valley Bank and the emergency sale of Credit Suisse to UBS, as well as the growing uncertainty in the capital market associated with these events, this financing was not realized,” it said. Discussions with other possible donors were unsuccessful.
Sono Motors has already paid more than 1.7 million euros to customers who did not agree to the repayment plan. According to the information, a further 800,000 euros should be paid out in mid-April. It is currently unclear how many interested parties are still waiting for the repayment and how much money is involved in total.
Listed US parent
Together with the GmbH, in which the operational business of Sono Motors is based, the parent company Sono Group, which is listed in the USA, is also entering into protective shield proceedings. The Sono Group had raised approximately 135 million US dollars in the IPO and was traded with a market value of over 2 billion US dollars. The share price has fallen sharply since then and was trading at just $0.24 as of Monday evening.
In the protective shield process, Sono Motors now wants to reorganize itself during ongoing operations. The company remains committed to its strategy of focusing on “the retrofitting and integration of solar technology into third-party vehicles.”
(vbr)