Early warnings on Tritium collapse

Tritium, the poster child of Anthony Albanese’s manufacturing revolution, was in talks about a potential insolvency appointment five months before the fast charger firm collapsed.

PM Anthony Albanese on a visit to electric vehicle chargers manufacturer Tritium in Brisbane back in 2021. Picture: NCA NewsWire / Dan Peled

It seems failed fast charger firm Tritium - once the poster child of Anthony Albanese’s manufacturing revolution - realised the game was up as early as last November.

According to filings to ASIC, Tritium’s board was toying with appointing insolvency specialists last year, five months before KPMG and McGrathNicol moved in as receivers and administrators respectively.

KPMG in a report to ASIC said it had been involved in 21 teleconferences between November and April with Tritium directors, certain members of its senior management team and professional advisors to explain the various options available to the group and “the nature and consequences of an insolvency appointment.”

The teleconference also allowed KPMG to obtain enough information about the financial position of the group and the estimated level of funding that would be required in “any future insolvency scenario.” On December 12 last year, KPMG was engaged by law firm Corrs Chambers Westgarth to undertake contingency planning “in respect of the Tritium Group in the event a formal insolvency process was required.” The scope of the engagement was to review and analyse Tritium’s financial and operational position and to consider the timing, costs and impact on stakeholders of a voluntary administration.

PM Anthony Albanese at Tritium’s HQ in Brisbane

Tritium finally appointed receivers on April 18, with creditors owed more than $150m, after effectively running out of cash. For Tritium, once worth an estimated $2bn when it listed on the Nasdaq in 2022, Albanese’s repeated visits to its Brisbane factory over recent years had all been in vain. “These jobs are secure jobs. They’ll grow,” Albanese, as leader of the Opposition, told journalists when he visited the Tritium factory in Murarrie exactly two years ago. “They’re looking at expansion here in Australia. This is an example of the opportunity that is there from embracing the future.” Tritium chief executive Jane Hunter in 2022 had boasted Tritium was set to expand its global manufacturing capacity and was poised to overtake engineering giant ABB as the world’s biggest EV charger maker.

A Tennessee factory in the US was expected to house up to six production lines for Tritium’s fast chargers. Tritium’s creditors are set to get an update on the future of the firm next week from the administrators and receivers.

Hard times

Some frightening figures from Queensland restructuring expert Jarvis Archer, who says company insolvencies for the financial year are tracking at 33 per cent above pre-pandemic levels. Archer, who is head of business restructuring and insolvency at Revive Financial, says insolvencies since October 2023 have tracked at 44 per cent above pre-pandemic levels. “I think we’re seeing a difficult psychological journey for many small business owners,” says Archer. “They are having to accept the difficulties of the past few years and look to further refine their businesses for the difficult economic conditions that are the reality for the foreseeable future.” Archer says the real change in the corporate insolvency landscape has been the rapid rise of the small business restructure (SBR).

March saw a record 212 SBRs, nearly six times the average of 37 SBRs per month in the 2023 financial year. “This new restructuring process introduced in 2021, has been an amazing success for small businesses trying to get back on their feet,” he says.

They allow business to write off an average of 75-80 per cent of their debts, mostly tax bills, accumulated during the pandemic.

Revive Financial Partner Jarvis Archer