Swedish electric vehicle (EV) battery developer and manufacturer Northvolt has collapsed into administration, with at least $1bn of investment needed for a rescue deal.

The CEO of Northvolt, Peter Carlsson, today resigned amongst ongoing fallout from the Swedish EV battery maker’s U.S. Chapter 11 bankruptcy filing.

Northvolt's financial collapse deals a blow to Europe's plan to set up its own battery industry to power electric cars, stirring a debate about whether it needs to do more to attract investment as startups struggle to catch up with Chinese rivals.

Northvolt, a major Swedish battery maker, filed for bankruptcy in the U.S., seeking to restructure the debt it had taken on to pay for its rapid expansion.

Northvolt transformed in a matter of months from Europe's best shot at a homegrown electric-vehicle battery champion to a struggling company.

This move is part of a strategic effort to restructure debt, scale operations and secure a sustainable foundation for continued operations.

The chief executive of Northvolt stepped down on Friday, shortly after the Swedish battery maker filed for Chapter 11 bankruptcy protection in the U.S.