Rad Power Bikes, once valued at $1.65 billion in 2021, has filed for Chapter 11 bankruptcy, citing significant financial challenges. The Seattle-based manufacturer of electric bikes has identified the largest creditor as U.S. Customs and Border Protection, owed over $8.3 million in tariffs, a claim that Rad has categorized as disputed.
The company’s financial troubles reflect broader issues within the e-bike industry, particularly following a sharp decline in demand after the pandemic's peak. In a letter to employees, Rad warned that it could face shutdown as soon as January due to these ongoing challenges. This downturn follows a surge in demand during the pandemic, where sales increased nearly 300%.
Additionally, the rising costs associated with tariffs have significantly impacted Rad and similar companies that depend on imports from Asia. Industry groups like PeopleForBikes have noted that these import duties are putting immense pressure on U.S.-based manufacturers, complicating their ability to compete effectively in the market.