The parent of the electric car maker, Coda Holdings Inc, has filed for bankruptcy protection. The company backed by Philip Falcone would seek to sell of its asset portfolio to a group led by a unit of Fortress Investment Group LLC.

Coda would now be focusing on its energy storage business according to a statement from its Chief Executive Officer Phil Murtaugh. Coda Automotive, the electric car manufacturing unit, is listed as one of the assets of the company, with a net cash of US$50 million and debt of US$100 million. The company said it would be selling off the unit within the next 45 days in its Chapter  11 petition filed in Wilmington DE.

The privately held Coda Automotive, who had in its roster of shareholders former US Treasury Secretary Henry Paulson, had marketed its electric car as a 'real world' vehicle having greater range and battery pack life with an acceleration far better than the competition.

The weak US market for electric cars again contracted to just about 5,000 units sold through August of 2012 compared to 6,300 for August of 2011, according to Bloomberg compiled data. Overall, 87,000 alternative fuel cars have been sold in the US, with only two years remaining for the President Obama deadline for one million electric cars sold.