Byton may be facing bankruptcy
The electric car startup Byton that started with such promise looks to be on the brink of collapse. According to the company, it will cease operations for half a year from 1 July – whether it will continue after that is open.
After it was announced in April that Byton had furloughed employees in its US headquarters in Santa Clara, California, about half of the employees working there were sent home due to the effects of the pandemic. Now a spokesperson confirmed that the company will cease operations for another six months on 1 July.
A comeback after this six-month period seems rather unlikely: Byton has now laid off almost all its employees worldwide, as spokesman Dave Buchko told the US specialist website The Detroit Bureau on Monday afternoon. “the board of directors and top management are looking to find a way to move the company forward.”
Byton was considered one of the most promising startups in the electric car industry. Founded in 2017, the company was long considered soundly financed and managed. While other companies with a similar concept and goal, such as Faraday Future, quickly disappeared from the scene, Byton was said to be able to really make the step to mass production.
It was only in January that Byton completed their third round of financing, and at the still ongoing CES it became known that the Japanese conglomerate Marubeni had joined in. In addition to the investment, a strategic partnership was also agreed. Also at the CES, Byton CEO Daniel Kirchert announced that 60,000 pre-orders for the M-Byte had been placed. The electric SUV was to be launched in China this year, followed by North America and Europe in 2021. Pre-orders for the M-Byte were to be made possible from the second half of the year.
For a long time, everything seemed to be on the right track, with pre-series production starting in Nanjing in October. But starting production and establishing the supply chain also ties up a lot of capital – and such a drastic event as the Corona crisis was not foreseeable. All of a sudden, money was no longer sitting so loosely with both potential customers and investors. “Without a revenue stream, we just hit the wall,” says the spokesperson.
In addition to the e-drive, connectivity and the 48-inch widescreen display were considered to be the outstanding features of the Byton M-Byte. With the K-Byte, an electric limousine, the second model was already in the starting blocks.
At present, it is unclear how Byton will proceed. According to Sam Abuelsamid, Principal Auto Analyst at Navigant Research, it is possible that a large Chinese company will buy into Byton and start production in China after all. After all, unlike other electric car startups, Byton has an almost fully functional factory. But he added, “I wouldn’t bet money on it.”
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