Arrival is on the verge of insolvency, media report

Arrival may be close to bankruptcy. Indeed, this would not be a surprise, as the newcomer has been struggling for quite a long time. The last news we have been reportedly dated back to February 2023 and concerned the UK company announcing 50% reduction of workforce in an effort to cut operating costs. At the same time, Igor Torgov replaced interim CEO, Peter Cuneo, in turn appointed in November, 2022, when the company’s founder Denis Sverdlov stepped back.

Arrival, founded in 2015, had previously announced its plan to refocus its resources on the development of its US Van product, therefore putting the Arrival bus project on hold in order to cut costs. In mid-2022 they had already announced a business reorganization.

In early 2020 the company announced it had received 100 million euros investments from Hyundai Motor Group and Kia Motors. Arrival had for long been known for the huge order for 10,000 light electric trucks from delivery company UPS, announced in late January 2020. 

Arrival on the brink of bankruptcy

Now, Sky News in Britain reported the Nasdaq-listed company “is in talks with EY, a professional services firm, about acting as administrator if the company cannot secure rescue funding“. Although there’s a possibility that Arrival finds the money to survive, it is still unclear how long Arrival’s remaining cash reserves would last.

As reported on Sky News, “Earlier this month, the company said it had received a further notice from Nasdaq warning that it was not in compliance with the listing rules. Shares in Arrival have plummeted by more than 95% over the last year, leaving it with a market capitalisation of just over $20m”.

Reuters wrote that “Arrival did not immediately respond to Reuters requests for comment, while EY declined comment on the report”. And notes: “EV firms that went public in the SPAC boom during the pandemic capitalized on strong demand from investors looking for the next Tesla. However, high interest rates, inflation, supply chain issues and production struggles have sapped their cash balances with few or no vehicles on roads”.

BloombergNEF expects that “2024 will also see further thinning of the herd of EV startups that stampeded into the market in the last four years. We expect more bankruptcies and consolidation”.

Arrival Bus project, a recap

Arrival electric bus project was announced in Spring 2020. At that time the company said it has invented a unique assembly technology to produce all the vehicles in its portfolio from what the company calls “microfactories”, deployable worldwide to serve local communities, pay local taxes and support retention of local talent.

The UK-based startup has debuted on Nasdaq in 2021. In May 2022 Arrival announced that it was going to start production of the electric bus in Q3 2022. Public road trials with First Bus were also expected in Q3 2022 (delayed). In the same 2022 Enel X and Arrival announced they have entered into a partnership to test the zero-emission battery electric bus in Italy. Also, Arrival had signed a partnership with Hitachi Europe regarding the providing of new bus and infrastructure solutions to the European bus industry.