Natron’s liquidation shows why the US isn’t ready to make its own batteries

This week marked the end of sodium-ion battery startup Natron as it ceased operations, concluding a 12-year effort to bring its innovative technology to market in the United States. Despite having secured $25 million in orders for its Michigan facility, the company was unable to fulfill these commitments due to delays in obtaining UL certification, as reported by Raleigh's The News & Observer. Natron had ambitious plans to create jobs in North Carolina with its new factory, but the lengthy certification process left it in a precarious financial situation. Investors were hesitant to inject more funds, leading to a cash shortage that the company could not overcome. Attempts by Natron's main shareholder, Sherwood Partners, to sell its stake were unsuccessful, forcing the company into liquidation and resulting in layoffs, with only a handful of employees remaining to manage the wind-down of operations. The closure underscores the significant hurdles associated with battery manufacturing in the U.S., particularly in the absence of stable industrial policies. Transitioning from a startup to a large-scale factory often takes a decade or more—far exceeding typical business cycles and investor trends. Natron is undergoing a liquidation process known as “assignment for the benefit of creditors,” which allows for a quicker sale of assets without the complexities of traditional bankruptcy proceedings. A year ago, Natron had announced plans for a much larger sodium-ion battery factory in North Carolina, projected to cost $1.4 billion and capable of producing gigawatt-hours of battery cells yearly, potentially generating up to 1,000 jobs. The company aimed to serve stationary storage and data center sectors, where the lower energy density of sodium-ion batteries is less of a drawback. Despite the promise of sodium-ion batteries being more affordable due to the abundant availability of sodium, their potential has been diminished by a dramatic price drop in lithium, with lithium carbonate prices falling 90% in the past two and a half years, according to Benchmark Mineral Intelligence. Natron is the latest in a series of companies facing setbacks in the quest to produce batteries outside Asia. In June, Oregon's Powin filed for Chapter 11 bankruptcy after struggling to find a non-Chinese supplier for lithium-iron-phosphate cells. Earlier this year, Swedish manufacturer Northvolt also declared bankruptcy, a significant blow to Europe's hopes for a domestic battery competitor, as the company reportedly lost $100 million monthly while trying to scale production. These failures highlight the challenges of establishing robust battery manufacturing capabilities outside of Asia, where mature supply chains and extensive expertise have developed over decades. To foster successful domestic battery production in the U.S. or Europe, sustained government support over many years will be essential, rather than the inconsistent strategies that have characterized the last 15 years. In the near term, partnerships with established companies like Panasonic, LG Energy Solution, and SK Innovation may offer the best path forward for Western nations in this critical industry.