Carbon Motors built a business model around for its diesel-powered E7 police car by securing a Department of Energy loan through its Advanced Technology Vehicles Manufacturing program for $310 million, but the US Government denied the company's application in March of 2012. From that point, it was evidently only a matter of time before the company caved in on itself. The warning signs were already thick on the ground when it was revealed that the company had quietly pulled out of its Connerville, Indiana plant back in April.
Bankruptcy protection shields Carbon Motors from lawsuits against the manufacturer. That's good news, considering three former executives have already filed a lawsuit against the company earlier this year for $600,000 in deferred wages.