Electric vehicle battery maker raises $15 billion for bankruptcy protection

• Electric vehicle battery maker Northvolt has entered Chapter 11 bankruptcy protection, the company announced Thursday.
• The Swedish firm, founded by two former Tesla executives, is struggling amid falling demand for electric vehicles.
• Peter Carlsson, CEO and co-founder of Northvolt, is set to step down as part of the bankruptcy process.

Northvolt, the electric vehicle battery company founded by two former Tesla executives, filed for Chapter 11 bankruptcy protection after struggling to ramp up production.

The Swedish company said on Thursday it had voluntarily entered bankruptcy proceedings in the United States to restructure its debt and secure new investment.

Shortly after the bankruptcy filing, CEO Peter Carlsson, one of Northvolt’s founders, said he would step down as part of the bankruptcy process.

Bankruptcy documents showed Northvolt had about $5.8 billion in debt and just $30 million in available cash, enough to fund its operations for about seven days.

Bankruptcy filings listed creditors as Goldman Sachs, JPMorgan and Microsoft. Since its founding in 2016, the company has raised more than $15 billion.

Northvolt said it has secured approximately $245 million in additional financing, including $145 million in cash, as well as a $100 million customer commitment to a debtor-in-possession facility, a specialized line of credit for firms going through bankruptcy.

“This decisive step will allow Northvolt to continue its mission to build its own European industrial base for battery manufacturing,” Tom Johnston, interim chairman of Northvolt, said in a statement.

“Despite near-term challenges, these actions to strengthen our capital structure will enable us to meet continued market demand for vehicle electrification,” he added.

Northwalt plans to continue operating during the bankruptcy proceedings.

Northvolt founded by Karlsson and Paolo Cerruti designed to revolutionize battery productionbut in recent months he has had problems.

The firm’s bankruptcy follows difficulties ramping up battery production at its plant in Skellefteå, Sweden, near the Arctic Circle. In June, BMW scrapped a $2.1 billion order for battery cells for its electric vehicles, citing delivery delays.

In September, Northvolt said it would lay off about 1,600 employees.

Automakers in Europe are struggling with weak demand for electric vehicles and growing competition from Chinese rivals.

Ford said Wednesday it would cut 4,000 jobs in Europe by the end of 2027.

VolkswagenEurope’s largest car company is considering closing plants in Germany for the first time and cutting tens of thousands of jobs. VW faces falling demand in Europe and has lost market share in China due to local competitors sell cheaper electric cars and hybrids.