The stigma of going through bankruptcy is real, whether personal or corporate. But sometimes, it turns out OK. Consider Proterra Inc., a maker of electric transit buses, battery packs and a developer of charging infrastructure.
Several startups in the electrification space ran out of financial runway. They either disappeared or were absorbed by other companies. Proterra’s electric transit bus business tasted early success after launching in 2004. Investors like automaker General Motors’ venture arm were early supporters.
Proterra’s expansion into battery making and charging infrastructure in the past decade was expensive. And the bus business gobbled up much of the $640 million raised in a 2021 reverse merger with special purpose acquisition company ArcLight Clean Transition Corp.
Proterra took on a lot of debt during the pandemic. It was forced to pay sky-high prices for scarce components and supplies. Ultimately, loan covenants that limited its ability to raise more capital hastened its Chapter 11 bankruptcy reorganization filing in August 2023.
Up for bankruptcy auction
That put Proterra’s three business units – Transit, Powered and Energy – up for bankruptcy auctions. The battery business brought $210 million from Sweden’s Volvo Group in November 2023. The transit bus business was sold for $10 million to Phoenix Motor Inc., which did business as Phoenix Motor Cars until rebranding as PhoenixEV in June.
The infrastructure business called Proterra Energy landed with Athelion Capital. Athelion loaned $175 million to Proterra with a proviso that Proterra could not seek new money elsewhere. The sustainability-focused private equity fund with $1.4 billion in assets got repaid in cash in the bankruptcy workout and picked up Proterra Energy for $10 million.
Battery and bus businesses mute
Phoenix did not respond to an email or call seeking comment on the integration of Proterra Transit into its existing medium-duty electric bus business. In a June news release, the company said it “is now capable of offering combined solutions for various classes and applications in the commercial fleet, school and transit markets.”
However, Phoenix (NASDAQ: PEV) faces delisting from the Nasdaq as soon as January because its share price has not met the exchange’s $1 trading threshold since early October. It closed Wednesday at 33 cents a share.
Volvo, meanwhile, kept the Proterra name for the battery business. CEO Chris Bailey referred questions about battery business progress to its new parent. Big customers like Daimler Truck North America’s Thomas Built Buses and Freightliner Custom Chassis Corp. units stayed with Proterra despite being charged more.
Both DTNA subsidiaries are in South Carolina, where Proterra’s major battery facility is located.
Proterra’s battery-making facility in Greer, South Carolina, now owned by Sweden’s Volvo Group, is said to be humming with activity following bankruptcy reorganization in November 2023. (Photo: Proterra)
Camber: More than a bend in the road
Brendan Harney, who ran Proterra Energy before bankruptcy, spoke positively about Athelion, aware of its role in hastening Proterra’s trip to bankruptcy court.
Brendan Harney spent three years at Proterra before becoming CEO of the post-bankruptcy entity called Camber. (Photo: Camber)
“A number of private equity folks were engaged in the Chapter 11 process,” he told me. “Athelion Capital had been an investor in Proterra, so there was an existing relationship there that was helpful. They understood the market thesis as well in terms of growth and opportunity. They knew that Proterra Energy had been a successful business within Proterra.”
Private equity is not always patient equity. How long will Athelion wait for its bankruptcy acquisition, now called Camber, to succeed in its growth strategy?
“I asked that very question of them, and they are patient investors,” Harney said. “They are focused on sustainability. They have a thesis within the space and it ranges across the spectrum for sustainable investments, but they want to see this grow and be profitable.”
Athelion owns 100% of Camber, so it could seek a merger partner or sell the business. Harney doesn’t see either happening.
“They’ve been supportive of our growth,” he said. “We’ve been adding to the team this year.”
Camber can paint on a larger canvas
Predating bankruptcy, Proterra Energy installed 1,500 direct-current fast chargers for commercial vehicles – and the software platform that manages them. Camber inherited both.
A Camber-branded charging installation (Photo: Camber)
“A lot of the relationships went with us, both suppliers [and] customers,” Harney said.
As part of Proterra, the energy business was limited to supporting Proterra customers partly due to limited resources. As an independent, Camber can explore different OEM relationships and market segments like last-mile and light-duty vehicles.
How does Harney think about the three years he spent at Proterra before leading Camber since it launched in March?
“We were enormously proud of what we did there. Speak to anybody at Proterra and you’ll find the same thing. Chapter 11 [was] successful in that parts of the business were able to continue and not be gathering dust somewhere in a warehouse.”
Daimler will add 400 new jobs in $285M Detroit plant makeover
Daimler Truck North America will invest up to $285 million to update its Detroit manufacturing plant and enhance research and development at the complex while adding 400 new jobs.
The Michigan Economic Development Corp. is providing incentives worth $27.5 million, and the Michigan Strategic Fund is providing a tax abatement of up to $3.29 million.
The manufacturing plant is part of the Daimler-owned Detroit Diesel Corp., which has produced engines, transmissions and axles for the Freightliner, Western Star and Thomas Built Buses vehicle platforms since 1938. Daimler purchased Detroit Diesel in 2000.
Like all heavy-duty truck makers, DTNA needs to make changes to its engines to meet Phase 3 Environmental Protection Agency greenhouse gas regulations that require significant reductions in smog-forming nitrogen oxide emissions.
DTNA makes its own engines and offers engines from Cummins Inc., which will begin selling a version of its 15-liter engine in 2026 that meets the 2027 requirements.
The investment follows an agreement earlier this year with the United Auto Workers, which came within minutes of striking the Class 8 market leader.
Briefly noted …
Paccar Inc., will pay an extra $3-per-share dividend on Jan. 8 to holders of shares as of Dec. 20. The parent of Kenworth, Peterbilt and DAF Trucks also raised its quarterly dividend 10%, to 33 cents from 30 cents.
Volvo Autonomous Solutions and DHL are running Aurora software in Volvo’s new VNL with safety drivers on Texas routes from Dallas to Houston and Fort Worth to El Paso.
The new Volvo VNL will begin autonomous operations in Texas with safety drivers. (Photo: Volvo Autonomous Solutions)
Nikola is selling new stock again, this time seeking up to $100 million through an at-the-market arrangement with BTIG, which gets a 2.5% commission on gross sales. Shares in the electric truck maker and hydrogen distributor traded at a 52-week low of $1.50 earlier this week before closing at $1.57 on Thursday.
Autonomous driving software developer Plushas been named to the Inc. 2024 Best in Business for AI and data; innovation and technology; and logistics and transportation.
Truck Tech Episode No. 94: Kodiak takes autonomy off highway to make the business case for driverless trucking
That’s it for this week. Thanks for reading and watching. Click here to subscribe and get Truck Tech delivered to your email on Fridays. And catch the latest episodes of the Truck Tech podcast and video shorts on the FreightWaves YouTube channel. Send your feedback on Truck Tech to Alan Adler at aadler@firecrown.com.
Correction: Last week’s Truck Tech mischaracterized the role of Freudenberg’s Capol division in candy making. Capol creates the shiny finishes, not the coatings themselves.
