Sweden-based electric truck maker Volta Trucks has filed for Chapter 11 bankruptcy protection due to supply strains leading to financial issues.
Volta, which also has operations in the United Kingdom (UK), cited the collapse of its US electric vehicle (EV) parts supplier Proterra and struggles in raising capital as reasons for delays in its production.
The company’s statement revealed the board’s recognition of the decision and the impact on its workforce. Moreover, Volta intends to file for bankruptcy in Britain soon.
Proterra’s Chapter 11 bankruptcy filing in August had a “significant impact” on Volta’s production plans, resulting in lower vehicle volume than the company forecast.
With deep and sincere regret, the EV maker said that the board has taken the challenging step of commencing bankruptcy proceedings in Sweden.
Volta stated that it has made significant progress since its inception in 2019. The electric truck manufacturer had raised around €300 million ($316 million) from investors and logged an order book of over 5,000 vehicles.
The company had also actively pursued mass production by choosing an Austrian factory for its production needs.
Multiple EV startups have recently secured significant funding but faced hurdles during their shift to mass production.
As interest rates rise, the startup financial landscape has grown more difficult, leading well-known firms like Proterra and Lordstown into bankruptcy.
Proterra’s Struggles Contribute to Volta’s Insolvency
Volta’s bankruptcy in Sweden and plans to enter administration in the UK has been attributed to the collapse of its battery supplier, Proterra.
According to Volta, the California-based company’s instability has exacerbated capital-raising challenges in the demanding EV manufacturing environment.
Volta, the primary trading entity, will soon file for administration in Britain, with Alvarez and Marsal overseeing the insolvency. Other entities within the electric truck maker will also initiate bankruptcy procedures in their respective legal jurisdictions.
The bankruptcy now puts around 600 jobs in the UK at risk.
Volta led the creation of the 16-tonne all-electric truck with innovative designs aimed at greening urban areas and enhancing safety.
