The battery cell manufacturer Northvolt is responding to its problems ramping up production. As the Swedish start-up announced, management wants to cut staff and divest from locations. Founder and CEO Peter Carlsson was quoted as saying on Monday that “hard decisions” were necessary “to secure Northvolt’s business foundations.” All resources must now be concentrated on becoming a leader in large-scale production of battery cells. Northvolt was founded in 2016 and is considered Europe’s hope in cell production. The first factory in Skelleftea, northern Sweden, is well behind schedule. The management there now wants to stop the facilities for a preliminary product, the cathode active material. The aim is to reduce operating costs and optimize the ramp-up of the entire factory, i.e. to get cell production up and running more quickly with purchased material. Around 300 of the site’s 3,000 employees work in the facility for the preliminary product in Skelleftea. In total, Northvolt has around 6,000 employees in several countries. It is said that how many jobs will be eliminated is now being discussed with the unions. Northvolt plans to provide further details in the fall. Several projects are being questioned. In Borlänge, Sweden, the company wants to sell an area on which another factory was planned. As already announced, the work of a development center in America will be relocated to Sweden. Investors are being sought for a location in Poland to support production. However, they are sticking to the plans for Heide in Schleswig-Holstein, for a joint venture with Volvo and a location in Canada, it is said. A decision will be made about “possible adjustments to the schedule” in the fall. Northvolt has so far raised around $15 billion from investors. The VW Group, among others, holds shares.More on the topicIn a statement, the company emphasizes that the importance of the battery cell industry in the fight against climate change remains high. It also remains true that the automotive industry’s supply chains must be regionalized. This means: Setting up local cell production in Europe remains a priority. At the same time, Northvolt makes it clear that its own success also depends “on the general demand for electric vehicles”. In Europe in particular, the market for electric cars has not developed as expected from the industry’s perspective. Several cell manufacturers have already trimmed their plans and stopped construction projects. We also need “support from our stakeholders,” the report continues. The company is currently negotiating a new round of financing. It is not known when the talks will be concluded. The company wants to sell an area in Borlänge, Sweden, where another factory was planned. As already announced, the work of a development center in America will be relocated to Sweden. Investors are being sought for a location in Poland to support production. They say they are sticking to their plans for Heide in Schleswig-Holstein, for a joint venture with Volvo and for a location in Canada. A decision will be made on “possible adjustments to the schedule” in the fall. Northvolt has so far raised around $15 billion from investors. The VW Group, among others, holds shares.
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