Volvo has purchased Proterra's assembly factory in South Carolina and a development center for battery packs and modules based in California in a bankruptcy auction in the US.
The electric bus and battery maker filed for Chapter 11 bankruptcy protection late this summer, in a surprise move that jolted the EV industry.
Proterra's bankruptcy filing over the summer has also prompted Volta Trucks, a startup aimed at last-mile electric delivery vans that relied on Proterra for battery packs, to file for bankruptcy.
The sudden bankruptcy of US-based battery and EV maker Proterra had already sent shockwaves throughout the EV industry earlier this year. The financial troubles of the innovative firm that took on quite a few EV-related projects over the years became visible only recently, and culminated in a move for bankruptcy protection in August.
This move has even forced another EV maker that relied on Proterra as its supplier, Volta Trucks, to do the same just weeks ago.
Now, Volvo has been picked as the winning bidder in the EV supplier's bankruptcy auction, buying the business and assets of the Proterra Powered unit for $210 million. Launched in 2004, Proterra had been valued at $1.6 billion at the time of its SPAC merger in 2021.
Volvo has purchased an assembly factory in South Carolina and a development center for battery packs and modules based in California.
"With this acquisition, Volvo Group will complement the current, and accelerate its future, battery-electric road map," Volvo said in a statement.
The purchase itself is still subject to merger clearance from US regulators and a bankruptcy court, which should wrap up in early 2024.
"We entered into the Chapter 11 process with a mission to maximize the potential of each of our product lines. Today, we have taken an important step toward that goal for our Proterra Powered business," Gareth Joyce, Proterra CEO, said days ago.
At times, Proterra has been seen as trying to do too many things at once in the EV sphere, building not only batteries for other EV startups and established automakers, but also assembling entire electric buses for US cities and solar grids for their charging, as well as delivery vans. For example, Proterra's batteries were installed in electric school buses assembled by another company.
But at the same time, Proterra itself was seen as not producing enough revenue to keep going, with the complexities and timing of delivery contracts with cities viewed as one of the reasons.
It remains to be seen whether this acquisition by Volvo, with China's Geely as its parent company, will allow smaller startups that relied on Proterra to right their ships. But in the meantime, Proterra's value to Volvo and its parent company is thought to rest largely in its battery production business.
This part of Proterra's business could be very useful for Volvo's recently launched charging unit, announced just days ago, which plans to offer charging solutions for homes and enterprises. Whether its electric bus unit will survive this transition is a separate question.
Will we see home energy storage go mainstream in this decade, with offerings from automakers, or will this process be largely separate from EV ownership? Let us know what you think.