Federal safety regulators have ordered Santa Rosa electric vehicle distributor Zap Jonway to buy back nearly 700 of the company's three-wheeled Xebra vehicles and destroy them at a cost of more than $2 million.
The National Highway Traffic Safety Administration's order requires Zap Jonway to pay the owners of 691 Xebras $3,100 per vehicle, an amount the agency said was based on the purchase price minus a "reasonable allowance for depreciation."
The order is the latest setback for the homegrown company, which has lost $85 million since 2009 and fought off an attempted coup at the end of 2012 from a faction of its board of directors.
Zap's name and sign remain on the block-long two-story building at Fourth and B streets in downtown Santa Rosa, but the doors are locked and the former vehicle showroom is dark and empty.
The government order requires Zap Jonway to permanently mark the title of each 2008 model year Xebra as a "junk automobile" and to pick up and dispose of each vehicle within 30 days of buying it from the owner.
Zap Jonway must either permanently disable each vehicle or dispose of it by "crushing or shredding," the Nov. 13 order said.
Chuck Schillings, the company's co-chief executive officer, responded to the safety agency in a Nov. 26 letter stating that Zap Jonway was "committed to providing a remedy to affected vehicle owners" but could not agree with some conditions of the order.
The "one-size-fits-all" buyback amount of $3,100 does not address situations in which a Xebra has been junked, is in poor condition or is owned by someone who wants more money, Schillings' letter said.
He also asserted that two of the Chinese-made Xebras were subsequently exported from the United States and 62 were in Zap Jonway's control, leaving 627 subject to recall.
Reached by telephone on Wednesday, Michael Ringstad, Zap Jonway's controller, said: "Mr. Schillings said he has no comment to make at this time" and hung up.