Small Town Of Benicia, California Reacts To Losing CODA Assembly
CODA Automotive is based out of Los Angeles, California. However, the 88 mile electric sedan that bears the company name, was assembled almost 400 miles away, in the small town of Benicia (pop 27,000).
After a string of high profile layoffs and supplier lawsuits and write-offs at CODA, the company filed for Chapter 11 protection last week, in hopes of re-inventing itself, not as a electric vehicle maker, but as a “energy storage company.”
A quick check of CODA’s website, that used to feature their very plain, very Chinese-looking electric car, now features only the bad news of bankruptcy.
Naturally, if automotive operations at CODA have now ceased, the town of Benicia, who welcomed the company to the area only 20 months ago, is now down one industry that they had hoped would be assembling thousands of plug-in vehicles per year going forward.
Filling out the backstory of the town left behind, the Benicia Herald has done a fine job of collecting reaction from area officials, and their take on CODA’s closure and subsequent effect on the local economy.
For Benicia Mayor Elizabeth Patterson she feels that CODA’s failure was in part due to bad timing.
“I am disappointed about the CODA bankruptcy…There are many factors for success and failure, and the most important is execution of the vision. In this case, the timing of the CODA launch at the beginning of the Great Recession must be considered a major factor, but the recession is not the only reason for the bankruptcy.”
VIDEO BELOW: CODA Automotive’s Promotional Video (seriously) Showing The First Assembled EV Coming “Off The Production Line” In Benicia, California:
Mario Giuliani, who is the Economic Development Manager, saw CODA’s time in the town as “a win unto itself.”
“This shows that our city is well positioned to attract new startup companies,” while adding that the closure of CODA did not actually affect the city’s tax revenue “as CODA operations were not a point of sale. To our knowledge, the majority of employees assigned to CODA operations in Benicia were AMPORTS employees and they have been assigned to other operations.” (As FYI, AMPORTS is one of the larger auto processors in North America with a facility in Benicia)
Chairperson of the Benicia Community Sustainability Commission, Kathy Kerridge said on the business of making cars:
“While I don’t know the specifics of CODA and how it will affect Benicia, I do know that it is very difficult for any small car company to survive, and it has been so for generations. Think the Edsel, Delorean, and others I have never heard of.” – and yes, she did just say that last part.
While original CSC (Community Sustainability Commission) chair, Constance Beutel, also echoed her replacement’s sentiment:
“I can only imagine the number of car companies, at the beginning of the gasoline-powered car era, that began and faltered within a short time of startup. There are stats on the success rate of new startups, and CODA’s demise shouldn’t be taken as a bellwether for the entire industry. Electric or clean-energy cars are vital and there’s a market ready for them.”
The Mayor of Benicia also offered the town’s outlook for the future:
“We embrace diversifying our businesses in the Benicia Industrial Park in order to meet the challenges and opportunities of the clean-tech future. Clean-tech companies are the largest job growth sector in California…As fossil fuel cars meet the new California standards for fuels, hybrids, electric and hydrogen cars, trucks and buses are surging in sales as well. I look forward to more new businesses that will strengthen Benicia’s industries in innovation and investments to meet the opportunities and challenges of the new technologies.”
CODA and Benicia announced their partnership in September of 2011, and at the time, expected at least 50 new jobs to be created in the area.
It should be noted, that the bulk of actual production of the CODA electric sedan did not occur in Benicia – that happened in China, but rather the final assembly of some lesser jobs to make the car ready for sale, as well as installing the car’s motor, battery pack, and electronics did.
Why did CODA choose to do any of the production in the US in the first place?
By importing near complete cars and then installing the powertrain in California, Coda could claim their plug-in sedan as American made, and thereby it would be eligible to apply for the DoE ATVML low interest loan program.
Which it did. $334 million worth. However, it became quite clear very quickly that CODA was not a viable entitiy and no monies would be forthcoming. CODA withdrew its request for funds in 2012. In total, CODA sold between 78 and “less than” 100 electric cars before going bankrupt.
So, would Benicia do it all again if they had the chance? You bet says the former CSC chairperson Beutal.
“That’s what our city is about, innovating, working it out until we find that one, and then the next ‘one’ success.”
For more comments and reflection on CODA Automotive in Benicia, check out The Benicia Herald’s story here.