Northvolt, a Swedish battery company owned in part by Volkswagen and Goldman Sachs has filed for bankruptcy in its own country. The news was broken by Reuters and could have serious ramifications for several automakers. Northvolt was Europe’s best hope of breaking China’s hold over EV batteries and customers let down include the Volkswagen Group as a whole, particularly the brands Porsche and Sweden’s own heavy truck company, SCANIA. BMW was let down last year when Northvolt couldn’t fulfill a $20,000,000 order, and the Porsche 718 Boxster project has been impacted by delays too. This is the deathblow for the battery maker, established in 2016, following its American interest in filing for bankruptcy in November last year.

A Problem For Sweden

For Sweden, this goes down as the biggest bankruptcy in its corporate history, even taking the epic collapse of the automaker Saab into account. When Northvolt filed for bankruptcy in the US, it showed $8 billion of debt across all of its entities. “This was a decision we did not take lightly,” Northvolt Chairperson Tom Johnstone told a press conference, and that it was the only “realistic path forward.” He also expressed that every avenue had been pursued to prevent the bankruptcy and inevitable job losses that would follow.

According to Northvolt, North America and Germany were not filing for bankruptcy in North America, Germany, or Poland. Canada’s Industry Minister Francois-Philippe Champagne said the Canadian government was in talks to help find a buyer for Northvolt’s plant in Quebec. Canada is currently more than happy to host battery production.

The company’s Gigafactory in Brandenburg (near the country’s capital in Berlin) started building the facelifted electric crossover today.

The big hope was that Nothvolt could go up against Chinese bands like CATL and BYD, and Volkswagen saw Northvolt as part of its plan to catch and surpass Tesla. Fortunately for Volkswagen, Tesla is looking like a dead company walking, but the Chinese brands are only getting stronger and would also capitalize on Tesla’s demise as they look for more ways into the west.

Sweden’s Deputy Prime Minister Ebba Busch said the government stood ready to support Northvolt employees, and she hoped “the business will be able to find a new long-term owner.” However, if Volkswagen, who stood to gain the most from Northvolt’s success, hasn’t stepped up further, it’s unlikely another business will want to follow. Volkswagen had a 21 percent stake, while Goldman Sachs held 19 percent of the company. As it stands, Northvolt’s only operational plant is in Skelleftea, Sweden, leaving seven either under construction or planning, canceled or divested, or no longer financed by the company.