Ascend Components mentioned on Friday it has began Chapter 11 chapter proceedings within the U.S., a heavy blow to buyers who had sunk practically $900 million into the corporate.
Linh Austin, Ascend’s CEO, introduced the choice in a post on LinkedIn late Thursday night time. He mentioned the corporate confronted “insurmountable” monetary challenges.
Ascend’s submitting comes amid a softening marketplace for electrical autos within the U.S. and was doubtless compounded by the Trump administration’s choice to cancel a $316 million grant supposed for a Kentucky facility that was beneath development. On the time, $204 million was disbursed, however Ascend needed to search for extra capital to make up the shortfall.
The marketplace for EVs within the U.S. has hit a tough patch lately. Although gross sales surged previous to the top of tax credit in September final yr, they haven’t fairly recovered. Analysts predicted that prospects who might need purchased this yr pulled their purchases ahead to make the most of the credit score, nevertheless it didn’t assist assuage automakers’ fears.
Since then, a number of automakers have dialed again their plans for brand new EVs within the U.S. For instance, Volkswagen mentioned yesterday that it was ending manufacturing of the ID.4 at its Chattanooga, Tennessee, manufacturing unit in favor of the gas-powered Atlas.
Ascend has developed a course of to extract beneficial vital minerals from scrap and end-of-life batteries. It says its course of limits the variety of steps wanted to rework shredded waste into precursor supplies for brand new cathodes.
The corporate has been constructing a 1 million-square-foot facility in Kentucky that has been beset by lawsuits and delays, based on local reports.
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Like many battery-related startups, Ascend was getting into a difficult and cutthroat business. The biggest marketplace for battery supplies is cells for EVs, however automakers have lengthy lead instances, and their specs are recognized to vary over time. Chinese language producers, which profit from regular and beneficiant state assist, have been dominating the market and driving down prices.
Different recycling startups like Redwood Supplies have pivoted to reusing among the packs that circulate by way of their sourcing community. The startup developed a method to incorporate a variety of various pack varieties into bigger, grid-scale batteries able to powering knowledge facilities. The marketplace for stationary storage has exploded lately, permitting Redwood to attract near-term income whereas persevering with to construct its recycling enterprise.
