Bankrupt battery maker Northvolt to end production

STOCKHOLM: Swedish electric car battery maker Northvolt, which filed for bankruptcy in March, will stop production at its main factory in Sweden in June, the court-appointed bankruptcy trustee said Thursday.

Founded in 2016, Northvolt had been seen as a cornerstone of European attempts to catch up with Asia and the United States in the production of battery cells, the crucial component of electric vehicles.

Mikael Kubu, the trustee managing the bankruptcy process, said in March that he hoped that the ailing company could “maintain production” while they searched for a buyer.

“The bankruptcy estate has been able to continue battery cell production with a limited number of employees, supported by the existing customer,” Kubu said in a statement.

However, Northvolt only had a single customer left, truck maker Scania.

“This arrangement is not sustainable in the long term for a single stakeholder, nor for the bankruptcy estate itself,” he added.

Kubu said that as a consequence “a gradual wind-down of battery cell production” would be initiated at the company’s main factory Northvolt Ett in the town of Skelleftea with the objective of ending production by June 30.

The trustee added that “efforts to identify a purchaser remain ongoing.”

Northvolt had struggled under a mountain of debt, slow demand and production delays, when it applied for bankruptcy in Sweden on March 12.

Later that month, Kubu announced that more than half of the company’s 5,000 staff would be laid off, with around 1,700 kept on during the bankruptcy process.

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At the time, Kubu told news agency TT that continuing operations during the bankruptcy process was “likely crucial to be able to sell the business entirely or partially”.

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.