Northvolt CEO Peter Carlsson Quits After Bankruptcy Filing

(Bloomberg) -- Northvolt AB Chief Executive Officer Peter Carlsson is stepping down as the Swedish battery maker embarks on a restructuring under bankruptcy court protection.

Carlsson, a co-founder of Northvolt, has led the electric-vehicle supplier since its inception in 2016. He raised billions of dollars in debt and equity with a promise to be a pioneer in European battery production. 

The plan unraveled after a string of operational setbacks hobbled its finances. On Thursday, the company filed for Chapter 11 bankruptcy protection in the US after a desperate bid to secure rescue funding fell short, leaving the struggling battery maker with just one week’s cash in its accounts.

Carlsson, 54, said it was time for new leaders to step in. He will remain a board member and senior advisor, the company said.

Northvolt “is like a baby for me,” he said at a press conference on Friday. He said he’ll support it “in any capacity that I can but also handing over to a very competent leadership team.”

Under Carlsson, Northvolt spent freely and expanded rapidly to create the scale he saw as necessary to compete with established battery cell manufacturers in China and Korea. It built its main plant in Skelleftea, Sweden, near the Arctic Circle and establishing outposts in Germany, the US, and Canada.

The company, once a candidate for an initial public offering valued at $20 billion, the company received about $10 billion in debt and equity funding. 

But it found itself in a fast-moving liquidity crisis in the autumn, after it failed to ramp up production at its main factory. Slowing growth for electric vehicle demand led customers to recalibrate the need for batteries. 

Northvolt quickly retrenched and began negotiating with owners, lenders and customers on a rescue package. Volkswagen AG, the company’s biggest investor and top customer through its Scania truck unit, told Carlsson it couldn’t continue providing capital, he said.

In its filing on Thursday, the company said its cash had dwindled to about $30 million — enough for one week of operations — while debt topped $5.8 billion. 

Battery Evangelist

Carlsson became an immediate media darling after he was recruited to the project by green-tech investors Carl-Erik Lagercrantz and Harald Mix early on. Prior to Northvolt, Carlsson had spent four years working closely with Elon Musk as head of Tesla’s supply chain.

His popularity and visibility in the media plunged over the past year, following a series of reports on the company’s struggles to set up functioning production and stop the financial bleeding. The company recently replaced the boss of its main plant and shelved an expansion there, putting the unit overseeing the project into bankruptcy.

Among the company’s major challenges to pull off a successful restructuring is to find a financial or strategic partner.  

“I should have probably pulled the brake earlier on some of the expansion paths in order to make sure that the core engine was moving according to plan,” Carlsson said.

(Updates with background on Carlsson’s tenure)

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