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As Electric Last Mile Solutions Inc. prepares to liquidate under Chapter 7 bankruptcy, the company’s rollercoaster ride is a sobering lesson for startups and investors in the EV space, according to industry observers.

ELMS excited investors with its concept of electric last-mile delivery vans, reaching a $1.4 billion market value shortly after it started trading a year ago. But it soon was confronted with a harsh reality: making cars is hard.

“You can attract a lot of capital, but eventually you have to produce a car or van or truck, which is very hard to do and expensive,” said Steven Wybo, senior managing director at Riveron. “It costs billions of dollars. They were kind of doomed from the start unfortunately.”

The company, founded in 2020, announced late Sunday that it planned to liquidate, but it has yet to make the formal filing, according to bankruptcy records.

Its stock was trading at 19 cents per share as of Monday afternoon, losing nearly all its value from the $14 peak it achieved shortly after going public via SPAC merger. read more

GM is pursuing a two-track strategy: Investing heavily in EVs and funding those investments by trying to maximize profits from its North American ICE trucks and SUVs.