REPORT: Vectrix ready to file for bankruptcy
by Jeremy Korzeniewski on Jul 15th 2009 at 6:51PM 
Vectrix scooter - click for high-res image gallery
According to the Providence Journal, electric scooter maker Vectrix has laid off nearly all of its employees and is likely headed for bankruptcy within the next 30 days if new investors or a buyer isn't found in time. A quick visit to the company's home page brings up nothing. The reasons given for the trouble by Michael J. Boyle, president of Vectrix, are exactly as you'd expect:
When the financial markets totally dried up as soon as the financial crisis hit in October and November, we couldn't continue our dealer development program... Consumer financing dried up completely. These are expensive consumer goods, and without financing it's difficult for the typical consumer to buy one.Those same tough financial markets also mean it will be an uphill battle for Vectrix to secure any kind of future funding, especially since the company never turned a profit and couldn't realistically expect to do so any time soon. In any case, it's a sad ending for the company that at one time seemed to have so much potential.
UPDATE: It's official (PDF). Thanks to Mike H. for the tip!
Gallery: Vectrix Electric Scooter
[Source: Providence Journal]
Reader Comments (Page 1 of 2)
Zeph 7:13PM (7/15/2009)
This sort of thing just showcases what a complete load of bs the green revolution is. Companies that are actually doing something that would help get shelved and all the money goes to banks (and some tidbits to some makers of mostly crass automobiles). Remember that these are the same banks drying up the consumer credit market, supposedly because of the subprime crisis (no matter that the subprime was just a tiny fraction of the money spent to solve the subcrime crisis, oh the joy of financial leveraging).
Mark my words you wannabe hippies out there: the only thing that will come out of this elitist construct of green revolution is taxes. We could solve the environmental issues in a decade, if only big government and big finance got out of the darn way.
Reply
Mark 7:31PM (7/15/2009)
A bad business model doesn't work if it is green or not. These bikes where too expensive and they had very little dealerships. Companies come and go, but what is important is that the technology is used by companies that will servive.
To blame this on the government is weak argument at best. Also what have "elitist hippies" got to do with this? What have republicans got against the elite anyway, you want elite pilots flying planes, elite doctors, elite soliders, no or would you prefer to have some dumba** doing the job instead?
You say we could solve the environmental problems in a decade if we didn't have big government and big finance, well I am all ears to your proposal. How would we solve this?
I fear an answer though will not be forthcoming.
We have had 8 years of no financing and the problem got worse, so I would love to hear what you have to propose.
Reply
Zeph 8:28PM (7/15/2009)
First, learn to quote. Nowhere did I say "elitist hippies", which is actually a paradox. There is no substitute for reading skills so even if in my second point I answer you I doubt you'll understand.
Second, solving environmental problems in a decade: One word, ethanol. Not from corn, it can be obtained from a variety of biological sources. It's clean and carbon neutral. Most engines can be converted to run on it. It's quicker than going electric, something we could do in the long run anyway, and far more cost effective for the consumer, for now. The bulk of our problems is big oil, the solution is something that can compete with them. Ethanol is that product. Even planes could use it. And yes, we have enough agricultural land for it. The subproduct is animal feed. Ethanol and the rebirth of the family farm would get us back on track to real renewables in a decade, supplemented by wind and solar of course.
Only be elitist manipulation of the markets is oil even cheaper than locally produced fuels, and if you don't yet understand that modern economics are not real economics, just mathmatical manipulations of fiat currency in an information system, if you don't understand this then we will never see eye to eye and we will have to agree to disagree.
Mark 7:34PM (7/15/2009)
I call FOWL.
Reply
jpm 8:00PM (7/15/2009)
Maybe if they wouldn't have wasted so much money on those big ugly plastic fairings they wouldn't be bankrupt.
Reply
Derek Jones 8:06PM (7/15/2009)
Mark - having had first hand experience with Vectrix in trying to bring their bikes to market I think you are quite correct. The business model was flawed from the start. You either sell very few at a ridiculously high price, such as Tesla, or you design a bike that can sell in a price-range with a unique distribution plan that allows you to stay in business long enough to make money and grow. They got stuck in the middle and have neither.
Reply
JDred 8:16PM (7/15/2009)
Both of you are right Zeph and Mark. Too many of these new companies are operating under a business model of trying to recoup costs immediately and make a profit at the same time. They fail to realize that you need to build the market for your product FIRST, then recover investment and after that, profitability will follow. Not the other way around. Look at Segway.
Right now, why would anyone want to buy a Vetrix when a Zero S is priced lower and is a superior product?
And yes Mark, Govt. does have a hand in this. The Corporate taxes and regulations in the US make developing much less manufacturing anything in the US more and more impractical and unprofitable.
Reply
Zeph 8:34PM (7/15/2009)
I can accept that vectrix might not have the best electric product or even the best strategy, but all this is beyond the point. It was selling and it had a product adequate for the supposed problem, which is pollution. Right? It was green.
If we have parasitic banks that are "too big to fail", why can't he have companies that are "too necessary to fail"? Saving vectrix would have been cheap and they at least were on the right track, regardless of any failures in execution.
The fact that the financial system is allowed to sink them while it itself gets pratically a direct IV to the tax revenue stream... well, this alone should show anyone who still has a half working brain after all the flouride what is really going on here and what green is really about. It's a con. It's all about taxation, parasitism. And this regardless of the real environmental problems we do have (and which in great measure were created by missmanagement of resources from the very elites behind the banking system).
Throwback 9:24PM (7/15/2009)
Vectrix did not sell enough vehicles at a price to be profitable. No conspiracy, just a bad business model. You can't make people something they don't want.
Reply
Dolphyn 10:30PM (7/15/2009)
For what it's worth, http://investors.vectrix.com/ is still up ...
Reply
dgh853 12:16AM (7/16/2009)
As one of the 3,000 owners of a Vectrix this is bad news but not unforeseen.
It's easy to say the bike is overpriced compared to an equivalent petrol bike - but, so are all the other highway-capable electric motorcycles Zero, Brammo etc.
Vectrix has made a series of very poor management decisions including:
a. entering into contracts for large amounts of batteries that, when they couldn't achieve their ambitious sales figures, were costly to get out of.
b. not targeting the Euro market sufficiently, which is much better suited to short-range motorcycles/scooters
c. poor product vision - for 2009 they introduced a new model with even less range than the original Vectrix (with lead acid batteries) and a rebranded Chinese toy scooter which there was no market for.
d. not improving the base product by making a lithium battery pack option available
Hopefully other electric motorcycles manufacturers can learn from their mistakes.
Start small, plan on low initial volumes, keep overheads down. When you've proved that a market exists for what you're offering, then enter into the supplier contracts that bring the price down and allow you to do volume and grow. This start slow approach appears to be working well for Tesla and its Roadster, providing it with some good cash flow to support R&D for the Model S and a great deal of positive PR for the brand.
Reply
Mark 6:32AM (7/16/2009)
Well said Zeph, I agree with you (I don't know why you needed to use the NewsMax lingo though) you made a great point and ethanol would solve some problems. However this is one great problem with ethanol and that is water, if you change from using billions of gallons of oil everyday to have to move to billions of gallons of water. This isn't a problem if you are near the sea, but there are already problems of water supply in many countries so we would be turning to something that again puts strain on the environment.
Wind and Solar however don't need water, and geothermal requires very little water.
Reply
Zeph 8:28AM (7/16/2009)
Yes, it's not like water falls from the sky...
Seriously, why do people buy into scarcity? There is no such thing as water shortage, and geographic shortage could be solved with investment. Again, money is meaningless, it's just blips on a screen and pieces of paper. When the elites want to force oil on populations they are willing to cross a continent in pipelines. Again, why is there water scarcity? Answer: Because someone wants to keep people and resources seperate. Because someone wants to profit on scarcity, on poverty, on keeping people down. And it's all bs. Change to ethanol, convert some Peterbilts to ethanol, make a road train and ship water to wherever needed... there is so much that can be done now, yet people keep locking their minds into sound bytes.
F 8:45AM (7/16/2009)
Here's a suggestion for Vectrix: Approach Piaggio and try to sell all your technolgy. You have already worked together before, as Vectrix was going to license some of the technolgy used in the never-released Vectrix V3. Piaggio might be interested in some of your technolgy for use in its MP3 and other scooters.
Reply
Tim 9:14AM (7/16/2009)
Too bad that Vetrix isn't "too big to fail".
http://en.wikipedia.org/wiki/Crony_capitalism
Reply
shrek 10:28AM (7/16/2009)
OK, all Vectrix fans...
another suggestion: OFFER tech to STEYR MAGNA: they have a huge huge interest in EV with A123 and Ford,... and Capital. this might and could resue VEXTRIX with Li Batteries improving the Range . Piaggio coop with Magna and why not ask Harley as well to invest? ....
donkey! It is tooo late! isn't it?
al 10:53AM (7/16/2009)
Vextrix only allowed selected journalists to test their bikes. They felt that if a major "book" reviewed them they were gold. The reality is that they needed to allow all journalists to review the product and get out the message to a larger audience. Of course, this same selective choice of who gets to test vehicles is the same the GM uses now under the Lutz "error."
The bottom line is that Vextrix not only had a flawed business plan, but lacked the common sense public relations program that Toyota uses....ink is ink.
The Car Family
Reply
Knuckles 4:30PM (7/16/2009)
The Vectrix is, like the Segway, the answer to a question no one is asking. Of 100 "greenies" begging for alternatives to the ICE and current automobiles, 10 may have the money it takes to buy one and 2 will actually part with the cash. $15K "incentives" just means you will transfer the real cost to the next generation of taxpayers - wasn't that thoughtful of you.
You want Tesla or the Chevy Volt to be successful - shut your trap and open your wallet.
Reply
Malevole 5:06PM (7/16/2009)
Zeph: take off the tin foil hat, turn off Fox News and try reading legitimate studies for a change before you shove your foot further down your own throat. Ethanol has terrible EROEI and uses massive amounts of water (i.e. more than falls from the sky per acre), especially in places like the Ogallala Aquifer area where irrigation is used. Water for irrigation comes from aquifers that are not being replenished at the rate that water is currently being drawn (i.e. we're already using more water than is sustainable just for food crops and current ethanol production). In addition to that, ethanol competes with food for agricultural space, increases food prices, encouraging slash & burn practices elsewhere in the world to replace those exported food stocks, etc. The sustainable bio-wastes that are already produced could be more efficiently used by burning them to produce electricity and using that electricity for vehicles like these, rather than by extracting fuel from it (which is a water intensive process, by the way) and running it through an inefficient ICE. If future bio-waste electric plants use tried and true dry cooling techniques, they can use significantly less water on a bushel-for-bushel basis than the ethanol plant would. Also, existing coal plants can be run on a mixture of coal and bio-waste feed-stocks, reducing infrastructure needs.
The volume of water needed to grow new stocks to produce a significant amount of ethanol is magnitudes larger than the amount of oil that is shipped in pipelines; you're talking about building river systems, not pipelines, and also building desalination plants that use far more energy than is produced by the crops. Pumping water on this scale uses significant amounts of electricity, which makes EROEI on this new ethanol stock even worse. And of course, as mentioned earlier, producing electricity usually requires water. Current ethanol technology requires about four gallons of water to produce one gallon of ethanol - and that's just the conversion process; that doesn't include the water needed to grow the crops. Converting forest areas to agricultural areas significantly reduces the carbon sink ability of those areas. These are the only areas that conceivably receive enough rain to produce crops without irrigation or replacing existing food crops. It's a lose-lose situation. Ethanol as a solution has been thoroughly debunked and water management is an important consideration that was ignored for years. You shouldn't insult other peoples' math skills regarding the economy when you obviously lack the math skills to calculate water demands.
Reply
Zeph 6:55PM (7/16/2009)
Just some loose points for you M:
I didn't insult anyone's math skills, I just said money was irrelevant...
How can anyone now, mid 2009, with all that has happened, still use the same tired old "tin foiler lol" meme and expect to get away with it? Do realise you'll soon be talking to yourself, alone, on that one.
Just because numbers are big dosen't mean they are impossible. There is more than enough agricultural land to produce ethanol AND food. In fact, using old school systemic agriculture, like our greatgrandparents taught us, we could have surplus of everything. Sure, that would ruin the money economy, but I did say money was irrelevant. If people keep focusing on the money nothing will get done, because the banking institutions are full of crooks. Or is that tin hat also? I guess you're right and we shouldn't audit the FED anyways, I mean, Bernanke did threa... err, warn us that there would be a financial collapse if we did.
I reject your post because basically it's not true. Theres enough land, and sea, to produce all the ethanol fuel we would ever need, and it's carbon neutral as the plants (plural, not just corn) grown for it sequester the oh so mean CO2. Not that it's a problem but the ecofaschists only understand green tech in reference to the CO2 meme so I might as well throw it in there. Seaweed is good for ethanol for goodness sake.
Where water will be scarce is where corporations, following elitist agendas, take control of the delivery system and the aquifers. It's their artificial scarcity which will reduce water availability, not the global warming lie, not the climate change lie it morphed into, not the natural weather, not even the geography which we could get over with technology. It's croney capitalism that will make us suffer, not the malevolence of your post.