An unsustainable cash burn and an uncertain zero-emission truck market have caused Hyzon’s board of directors to dissolve the company.
Hydrogen truck maker Hyzon announced the company is being dissolved.
Hyzon’s board of directors voted to dissolve the company, subject to shareholder approval, according to news reports on Friday, December 20, 2024.
On that day, Hyzon issued a Worker Adjustment and Retraining Notification Act (WARN Act) notice to its employees at the Company’s Bolingbrook, Illinois and Troy, Michigan facilities, as well as to substantially all of its remaining employees in the states of Illinois and Michigan.
Hyzon cited its inability to raise funding as the primary reason for the dissolution. It also cited the future uncertainty relating to the availability of government subsidies, most notably the California Hybrid and Zero-Emission Truck and Bus Voucher Incentive Project.
Hyzon officials said they believe this uncertainty has caused some of its customers to slow down or suspend their zero emission purchasing decisions.
If the Company cannot raise funds or find a buyer, it is expected that the reduction in force will be completed in February 2025.
Unsustainable Cash Burn
The first inklings of trouble for Hyzon appeared in 2023.
In 2020, Hyzon said it could deliver thousands of fuel cell trucks and buses by 2023.
But by late 2022, Hyzon had only delivered a handful of vehicles and admitted it had failed to report its financial results from the past two quarters, resulting in a risk of expulsion from the Nasdaq stock exchange.
More problems surfaced in March of last year.
The company had limited capital on hand. And company officials noted at the time that it lacked the finances to support operations for another 12 months without an infusion of cash.
According to reports, in the third quarter of 2024, Hyzon had $30.4 million in cash and cash equivalents. At the time, the company was seeking to reduce its monthly spending down to $6.5 million per month by the end of the year.
According to reports, the company still spent almost $25 million in Q3 of 2024.
“The company intends to call a special meeting of its stockholders to seek approval of a plan of dissolution and expects to file proxy materials relating to the special meeting with the Securities and Exchange Commission as soon as practicable,” Hyzon said in a filing with the U.S. Security and Exchange Commission.
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