Administrators from EY Parthenon yesterday “arrived” at electric vehicle manufacturer, Arrival UK Limited and Arrival Automotive UK Limited (“Arrival”). This news comes only 3 months after the NTI newsroom reported on EV manufacturer, Volta Trucks AB, filing for bankruptcy following the bankruptcy of its main battery supplier Proterra.
Arrival’s publicised mission to “master a radically more efficient New Method to design, produce, sell and service purpose-built electric vehicles, to support a world where cities are free from fossil fuel vehicles" has failed. It claimed that its "in-house technologies enable a unique approach to producing vehicles using rapidly-scalable, local Microfactories". Despite these exciting objectives, Arrival, once valued at £10bn entered administration without having sold any finished models.
The Oxfordshire based company had previously secured huge investments from Hyundai, PNB Paribas and BlackRock before it went public and listed on New York’s Nasdaq in 2021. At the time it represented the biggest ever flotation of a British company. Many other manufacturers were also enjoying the excitement with truck maker, Rivian, shares valued at more than Volkswagen and luxury EV entrant, Lucid, valued more than Ford. However, since that time the euphoria in the EV market has subsided and despite its initial optimism, like other EV entrants, Arrival have encountered difficult terrain as market uncertainties overtake investor excitement.
Over the past two years Arrival have struggled with higher interest rates and increased costs. It made significant cuts to its workforce and last week delisted from the Nasdaq. Speaking of the decision to delist Arrival said that it “…was the result of the company not being in compliance with NASDAQ’s continued listing standards . . . and the failure to submit a remediation plan related thereto”.
Last year Arrival struggled to secure new finance after discovering errors in its accounts and failing to resolve this. Arrival issued a statement regarding its difficulties in which it stated:
"The Group’s liquidity position has been impacted by challenging market and macroeconomic conditions…”. Arrival went on to say that "As such, the Joint Administrators are now exploring options for the sale of the business and assets of the Companies, including its electric vehicle platforms, software, intellectual property and R&D assets, for the benefit of creditors."
With reported debts of over $300m as at June 2023, it appears unlikely that Arrival will be able to meet their obligations under contracts signed with UPS and Uber. Administrators, EY Parthenon, look set to be busy dealing with these issues together with managing several different UK sites including a factory in Bicester, a large development facility in Banbury and headquarters in Paddington. Around 172 employees are said to be affected by the administration.
