Official announcements from Northvolt or court filings regarding the completion of the restructuring process

Northvolt Files for Bankruptcy in US; CEO Steps Down, Blow to Europe's EV Battery Hopes

Nov 22, 2024, 03:35 AM

Sweden's Northvolt AB, once Europe's leading hope for a homegrown electric vehicle battery industry, has filed for Chapter 11 bankruptcy protection in the United States after failing to secure additional funding. The company, which had raised $15 billion from investors including Goldman Sachs and received a $2.7 billion pledge from Canada, is restructuring under bankruptcy court protection due to significant cash flow issues, with only $30 million in cash remaining and debts totaling $5.8 billion. CEO and co-founder Peter Carlsson has stepped down following the bankruptcy filing. Despite the financial struggles, Northvolt announced that operations at its flagship battery gigafactory, Northvolt Ett in Skellefteå, Sweden, and Northvolt Labs in Västerås, Sweden, will continue as it ramps up production to meet commitments to customers. Subsidiaries in Canada and Germany are financed separately and will operate outside of the Chapter 11 process, with the Quebec battery plant expected to proceed despite the bankruptcy filing. Scania, one of Northvolt's existing customers, has committed to providing $100 million in new debtor-in-possession financing to support the company's business operations during the restructuring, which is expected to be completed by the first quarter of 2025. Northvolt's collapse is seen as a significant setback for Europe's ambitions to establish an independent EV battery supply chain and reduce reliance on Chinese rivals. The company faced production issues, lost a major customer, funding shortages, and was criticized for mismanagement and over-reliance on Chinese machinery.