Battery cell maker Northvolt has filed for bankruptcy in Sweden, the company said on Wednesday, marking one of the country's largest corporate failures and effectively ending Europe's best hope of developing a rival to challenge China.

Europe’s ambition to lead the world in green industries was always going to be a stretch given China’s head-start in many low-carbon technologies. When it comes to electric vehicle batteries, the outlook is especially bleak.

The company and its assets will be sold after it filed for bankruptcy in Sweden, sinking Europe’s best hope for competing against Asian rivals.