Battery Maker Northvolt Files for Bankruptcy in Sweden, Future Canadian Plant in Limbo
Swedish electric car battery maker Northvolt has filed for bankruptcy in Sweden, dealing a blow to European efforts to challenge Asia's dominance in the key sector.
Founded in 2016, Northvolt has struggled under a mountain of debt, slow demand and production delays.
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The company had filed for bankruptcy protection in the United States in November to buy time to find new investors, but its efforts ultimately failed, leaving its 5,000 employees with an uncertain future.
Northvolt said in a statement Wednesday that despite pursuing "all available options to negotiate and implement a financial restructuring ... the company was unable to secure the necessary financial conditions to continue in its current form."
"Clearly, this is not an outcome we had hoped for," Northvolt interim chairman Tom Johnstone told a press conference.
The battery maker said in its US Chapter 11 bankruptcy filings that it owed $5.8 billion.
"With limited time and financial resources available, the company was unable to conclude the necessary agreements to secure its future," Northvolt said.
Northvolt said "a Swedish court-appointed trustee will now oversee the process, including the sale of the business and its assets and settlement of outstanding obligations."
It will be up to the trustee to decide what actions to take regarding Northvolt's subsidiaries in Germany and North America (where a new battery plant is under construction in Quebec), which are not filing for bankruptcy in their respective jurisdictions.
Johnstone said he hoped the outreach that had already been undertaken with investors would help the trustee "identify and secure such financing in the near-term."
"Though today marks the end of this chapter, we are hopeful that the foundation we have built, the technology, the expertise, and the commitment to sustainability, will continue to drive change in this industry," he told reporters.