Electric bike company Rad Power Bikes filed for Chapter 11 bankruptcy protection on Monday, weeks after warning employees it could go out of business without new funding.
A company spokesperson told TechCrunch that the company plans to continue operating while the bankruptcy case progresses and plans to sell the business within 45 to 60 days.
“This action will allow us to continue our normal operations while pursuing the best possible outcomes for the people who rely on Rad every day,” they said in a statement. “Our goal is to keep our company intact and maintain the relationships we have built with our passengers, vendors, suppliers and partners.”
Rad Power is the latest in a string of e-bike companies around the world to be forced into bankruptcy after pandemic-era excitement for the category waned. However, some of these companies have resurfaced with VanMoof and Cake finding new owners during their respective court-driven restructuring processes.
Rudo himself had told employees in November that there were “very promising” options to keep the company afloat and that it “could be shut down,” but the deal fell through. The company did not provide details about the potential deal.
Weeks later, the Consumer Product Safety Commission (CPSC) issued a warning that older Rad Power batteries pose a “risk of serious injury or death” after 31 reports of fires. Rad Power said he “strongly disagrees” with the CPSC’s characterization.
A tough November for Rad came at the end of a pretty tumultuous few years for the company. The company made multiple rounds of layoffs and replaced its CEO earlier this year, bringing in an executive with decades of experience turning around struggling companies. New CEO Kathy Rentsch said Rudd is moving away from the direct-to-consumer model that has fueled its growth and toward a retail-focused approach.
“This change creates new opportunities to reach more riders, strengthen customer relationships and evolve the brand in meaningful ways,” she said in a statement at the time. “[I]It’s a great time to be involved.”
The company announced that it had entered bankruptcy proceedings with assets of $32 million and debts of $73 million. More than $8 million of the company’s debt was owed to U.S. Customs and Border Protection for unpaid duties. (The company lists the claim as “pending” in its bankruptcy filings.)
It is unclear how much that contributed to RAD’s bankruptcy. But this isn’t the first time President Donald Trump’s tariffs have helped push micromobility companies into a corner. During President Trump’s first term, tariffs on imports from China helped take the remaining wind out of electric skateboard company Boosted’s sails. Boustead went bankrupt soon after.
