$PTRA — What Went Wrong for Them? Could It be Avoided?

Court: N.D. California

Case: 5:23-cv-03519

As we all know, Proterra filed for Chapter 11 bankruptcy in August 2023, after years of financial struggles. The company suffered from high production costs, long manufacturing lead times, and persistent supply chain disruptions that drove expenses up and slowed deliveries.

Its buses required highly customized builds, making it harder to scale production. This, combined with inflation and rising material costs, pushed quarterly losses to $244 million in early 2023.

At the same time, Proterra faced stiff competition from global manufacturers like BYD, which benefited from larger markets and more efficient supply chains.

The relatively small size of the North American electric bus market limited Proterra’s growth potential, and financing options became constrained under its debt agreements. In the end, the company entered bankruptcy, selling its three divisions to Volvo, Phoenix Motorcars, and a private equity fund.

These buyers now face the challenge of turning Proterra’s technology and assets into profitable, scalable operations in a competitive and capital-intensive market. We’ll see if they can make it happen.

Following its financial collapse, Proterra also faced a lawsuit from shareholders who alleged that company execs misled investors about its financial health, liquidity, and production efficiency. To resolve these claims, Proterra agreed to a $29M settlement, and the deadline to file a claim is this Friday, August 29. You can check the details and submit yours here.

So, the question remains: Could all these issues be avoided or solved in another way? And can the companies that now own the PTRA assets make it profitable?