Breathe, the EV company backed by the Mayor collapses into adminstration
Electric Vehicle Company, Breathe, which provides EV’s including Teslas to private-hire drivers, has collapsed into administration. This could greatly impact on London taxpayers, with millions of pounds of losses to be faced.
Sadiq Khan, the founder of The Mayor’s Energy Efficiency Fund (MEEF), had injected £3.2m into the company in March 2022 – just 15 months prior to administrators from Begbies Traynor being appointed. The MEEF was set up to provide debt and equity to small business owners, and is managed by Amber Fund Management.
As of yet, the reason for the collapse is not clear. The appointed administrators are working closely with all parties involved to complete a sale of the business and if needed, realise assets to enable any debts to be repaid.
Breathe operates with a subscription service, whereby customers can take full ownership of their car at the end of the subscription period. Other disciplines are involved too, with financial products being offered including insurance.
Sky News provide more information.
Readers Guide: What Administration Means for You
As Breath EV has gone into administration here is a quick guide to the legal realities of the administration process.
The Process: Administration is a legal “moratorium” that protects insolvent companies from creditor action. Licensed Insolvency Practitioners take control to either rescue the business or sell its assets to achieve a better result than immediate closure.
Who gets paid? There is a strict legal queue. Secured lenders (banks) and “preferential” creditors (employees and HMRC) are paid first. Unsecured creditors, including trade suppliers and customers, are at the back of the line and often receive nothing.
Employees: Redundancies often occur in the first 14 days. After this window, the administrator “adopts” remaining contracts, making ongoing wages a priority. Unpaid redundancy or notice pay can usually be claimed through the government’s Redundancy Payments Service.
Suppliers & Customers: Suppliers should negotiate “pro-forma” (upfront) terms for any new orders. For customers, gift cards and deposits are rarely honored. However, if you paid over £100 via credit card, you may be able to claim a refund under Section 75.