Swedish battery maker Northvolt filed for Chapter 11 bankruptcy protection in the U.S., delivering a blow to Europe's electrification ambitions.

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 Swedish-based lithium-ion battery manufacturer backed by Volkswagen Group and others, has filed for bankruptcy protection in the United States. The company was hailed as one of Europe's biggest hopes against China's EV battery supremacy.