Administrators were appointed to electric car subscription service Onto today, it was announced this afternoon.
The Warwick-based company had been struggling after being hit by the falling prices of EVs during the first half of the year, since its borrowings are secured against its fleet.
In July, it was reported to be facing possible administration after Legal & General said it wouldn’t be giving it rescue cash.
It’s believed that L&G ploughed £22.5m into the company over the previous couple of months, following a $60m (circa £47m) funding round the year before.
At the time, L&G was reported as saying Onto was ‘an ambitious company with a talented management team that will play a vital role in accelerating the transition to electric vehicles’.
But it’s believed that L&G’s decision not to give any more cash help led to restructuring firm AlixPartners making contingency plans for a potential administration.
Those worst fears have now been realised with today’s announcement that Gavin Maher and Jonathan Lees of Teneo Financial Advisory Ltd have been appointed as joint administrators of Onto Holdings Ltd.
Maher and Ian Wormleighton have also been made administrators over certain subsidiaries of Onto Holdings Ltd.
The administrators said they will be maintaining business operations with minimal disruption to customers as they look into strategic options for the business.
Founded in 2017, Onto offered cars to customers on a monthly subscription.
It grew to have more than 7,000 EVs in its fleet by the start of 2023 and introduced more than 20,000 people to electric cars via a subscription.
In a statement issued today by Teneo, Maher said: ‘Onto has suffered from the steep fall in electric vehicle residual value in the first half of 2023, rising interest rates and the squeeze on disposable income and was unable to secure additional funding from its shareholders.
‘After entering administration, Onto will continue to serve existing customers as the administrators explore strategic options.’
It was unclear how much more money Onto needed, but according to Sky News in July it was believed to be ‘substantial’. Onto was said to have ‘sizeable debt facilities’ with various lenders, and Car Dealer was told that Onto was exploring various investment options.
Car Dealer approached Teneo to find out the current status of Onto’s workers but a spokeswoman said that it wouldn’t be offering any further comment at this stage.
This story was originally published at 4.48pm on September 11, 2023 and updated at 8.27am on September 12 with Teneo’s response to our request for a comment.