Volvo Buys Bankrupt Proterra’s Battery Business
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Volvo Group will acquire the battery business of Proterra Inc. and Proterra Operating Co., the businesses said separately Nov. 10.
Swedish truck manufacturer Volvo Group won an auction of the assets of the bankrupt electric bus and battery manufacturer’s Proterra Powered unit with a bid of $210 million.
Volvo Group said the acquisition will complement its current battery-electric business and accelerate the unit’s future. The company has a three-pronged approach to decarbonization of its product line — battery-electric, fuel-cell electric and renewable biofuels. Fuel-cell electric vehicles use a combination of hydrogen and batteries. The Gothenburg-based manufacturer aims to have 35% of the vehicles coming off its global production lines to be electric by 2030.
Burlingame, Calif.-headquartered Proterra filed for Chapter 11 bankruptcy protection Aug. 7. It will seek approval from the bankruptcy court for the Volvo deal on Nov. 28.
A Proterra charging system. (Proterra)
“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,” Proterra CEO Gareth Joyce said in a Nov. 10 statement.
Proterra’s battery production plant is located in Greer, S.C., while its engineering team is based at the company’s headquarters.
The deal is expected to close early next year, Volvo said. Volvo is the parent company of Volvo Trucks North America and Mack Trucks.
VTNA currently offers five models in its VNR Electric product line: a 4x2 straight truck, a 6x4 straight truck, a 4x2 tractor, a 6x2 tractor and a 6x4 tractor. The last of those has a range of up to 275 miles when configured with a six-battery setup.
Mack Trucks introduced the MD Electric in March, its first medium-duty electric vehicle. The company also offers a heavy-duty LR Electric refuse truck. Recently, Mack Trucks showcased the MD Electric to media, including Transport Topics. The MD Electric uses Sea Electric off-the-shelf batteries.
When Proterra filed for court protection, the company said it hoped to maximize the value of its business lines by selling them off or recapitalizing the business. The company’s ambitions were hampered by supply chain disruptions during the COVID-19 pandemic, including the waning appetite of transit systems for its electric buses after widespread lockdowns and the broad shift across businesses toward telework, as well as rising interest rates chipping away at margins.
Proterra went public in June 2021, merging with a special purpose acquisition company.
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An auction of Proterra’s other units, its Transit and Energy business lines, including the company’s Valence fleet and energy management product, is set to take place Nov. 13, the company said. The Energy unit is a charging infrastructure business.
Among Proterra Powered’s current customers are Phoenix-based Class 8 fuel cell electric vehicle manufacturer Nikola; Sweden’s Volta Trucks, which filed for bankruptcy in October due to supply chain failures, including Proterra’s bankruptcy; and Gaffney, S.C.-based Freightliner Custom Chassis Corp, a Daimler Truck North America unit that produces motor homes, delivery vans, commercial buses and school buses.
A spokesman for Volvo said in an email Nov. 13 it was too early to comment on current or future business, and all possibilities were dependent on merger clearance.
Nikola is maintaining open communications with Proterra, a spokeswoman said in an email Nov. 12.
Phoenix-based Nikola previously used batteries supplied by Romeo Power, a company it acquired in August 2022. Less than a year later, in July, Nikola began liquidating Romeo’s assets.
Classes 4-6 truck manufacturer Mullen Automotive on Sept. 11 bought Romeo’s battery production assets for $3.5 million.
A spokeswoman for Freightliner Custom Chassis Corp. parent company Daimler Truck said Nov. 12 it was business as usual in the unit’s commercial relationship, and that no further information was available to share at this stage.
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Daimler Truck, meanwhile, has plans for supplying its own electric business with components. On Sept. 6, Daimler Truck said it would team up with engine giant Cummins Inc.’s zero-emission unit Accelera and fellow Class 8 truck maker Paccar to build a factory in the U.S. that will manufacture battery cells for electric commercial vehicles and industrial applications.
Paccar is the parent company of Kenworth and Peterbilt. Construction of the 21-gigawatt-hour plant is expected to cost $2 billion. China’s Eve Energy Co. will contribute battery cell design and manufacturing expertise.
Meanwhile, Daimler Truck North America and its partners in the proposed Greenlane electric and hydrogen vehicle fueling network expect to break ground at their first sites in early 2024.
