Northvolt, founded in 2016, had been struggling under a mountain of debt, slow demand, and production delays, leading to the bankruptcy, which may be one of the biggest in modern Swedish history, according to a report by news agency AFP.

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The battery maker's two largest shareholders are German carmaker Volkswagen which is also in financial difficulty, and US investment bank Goldman Sachs.

Northvolt had said in its US Chapter 11 bankruptcy filings that it owed $5.8 billion. This came last November as the company tried to buy time for finding new investors. However, its efforts failed.

The production delays it suffered from, caused the company to lose an order from BMW worth two billion euros last year.

As a result, 5,000 employees are left with an uncertain future.

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The report quoted the company as having said in a statement on Wednesday that despite pursuing “all available options to negotiate and implement a financial restructuring... the company was unable to secure the necessary financial conditions to continue in its current form.”

The company had announced that it was cutting 1,600 jobs, which is a quarter of its staff, as well as suspending the expansion of its Skelleftea site in northern Sweden, last September.

This is despite a target it set to reach an annual production of over one GWh this year, which is enough to equip 20,000 average-sized cars, according to the report.

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The company was founded by Peter Carlsson who was CPO and Head of Supply Chain at Tesla Motors before, and Paolo Cerruti who was the VP of Global Supply Chain and Operations Planning at Tesla.