Volvo Group has won an auction for Proterra’s battery business with a bid of $210 million – here’s what that means for the EV industry.
Volvo Group buys Proterra Powered
By acquiring the Proterra Powered business unit, Gothenburg, Sweden-HQ’ed Volvo Group is expected to gain a development center for battery modules and packs in California, and an assembly factory in South Carolina.
Proterra Powered‘s current remit is to transform medium- and heavy-duty commercial vehicles into EVs. Volvo Group makes trucks, buses, and construction equipment.
The transaction between California-based EV battery and platform developer Proterra and Volvo Group is of course subject to approval by the US bankruptcy court, but the closing is expected in early 2024.
Earlier this year, Proterra combined battery and bus production at its South Carolina facility alongside job cuts to cut costs. But supply chain and funding problems, as well as funding needed to scale, ultimately resulted in Proterra filing for Chapter 11 bankruptcy in August, as Electrek reported.
Gareth Joyce, Proterra’s CEO, said in a statement today:
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.
Electrek’s Take
Joyce says the sale is a way to “maximize the potential” of Proterra Powered – and it’s now going to be Volvo Group doing that instead of Proterra. And ultimately, as long as the manufacturing centers and the technology don’t go to waste, this is good news for the EV transition.
I asked my colleague Scooter Doll what he thought Joyce meant, as we’ve both covered Proterra regularly. He thinks Joyce is saying that it’s rough out there for smaller companies and startups. Proterra couldn’t do it alone, and the goal of bankruptcy was to get bought out so its tech could continue to be put to good use.
This is going to accelerate Volvo Group’s battery-electric road map, and this sale is a lifeline to scale commercial EVs and more. Plus, it should work to Volvo Group’s benefit in some form when it comes to the “American-made” battery requirement in the Inflation Reduction Act for tax credits. So it’s not the dream scenario for Proterra, but ultimately this acquisition is a good outcome for both companies.
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Keyword: Volvo is buying bankrupt Proterra’s battery business for $210M – here’s what that means