After a factory expansion in Sweden was stopped, the specially founded subsidiary of the battery manufacturer Northvolt has filed for bankruptcy. Northvolt Ett Expansion AB will now be run by a liquidator, Northvolt announced on Tuesday. The company is one of more than 20 subsidiaries of the Northvolt Group, but no others are affected by the bankruptcy.
The Swedish battery manufacturer, the biggest hope for a European supply chain for the construction of electric cars that is independent of China
, is in a serious crisis. Strong competition from China, weak demand for electric cars in Europe and its own production problems are causing Northvolt to stumble.
Two weeks ago the Swedes announced that they would put the expansion of the factory in Skelleftea on hold to cut a total of 1,600 jobs in the group. In total, this corresponds to almost a quarter of Northvolt’s entire workforce in Sweden. Even if the overall momentum of electrification remains strong, the right steps have to be taken at the right time to counter the headwinds in the automotive market, explained Northvolt boss Peter Carlsson (53). From banks and investors, including Volkswagen, Goldman Sachs and Blackrock, Northvolt had raised a total of more than $15 billion for its expansion.
What will happen to heather?
In Germany Northvolt is planning a battery factory at the Heide site in Schleswig-Holstein. The federal government has so far assumed that this project is not in question despite Northvolt’s difficulties. In the state parliament’s economic committee, Northvolt recently made a clear commitment to building the battery factory in Schleswig-Holstein. “We need this factory in Heide,” said Northvolt’s Germany boss Christofer Haux. “Heide is and remains a cornerstone in our expansion.” Haux joined us via video from Sweden.
The company cannot currently answer whether there will be detailed adjustments to the factory construction schedule, said Haux. “That has nothing to do with Heide.” The reason is the overall strategy. The company continues to feel strong support from the region. That is one reason why this is an important and correct location. “One reason why we are in Heide is the very special energy situation.”
“Northvolt is systemically relevant”
There is a lot at stake. Not only for Northvolt, Carlsson and its investors, but also for its customers – and therefore for the entire European automotive industry. Recently, one cell project after another was stopped. There is not a single European company that produces battery cells on a large scale.
In just a few years, the Swedish start-up, founded by Carlsson and a partner in 2017, will be A savior for politics and business
become equally. “Northvolt is systemically relevant,” said the head of a German automobile manufacturer, commenting on the situation at the beginning of June. “They have to do it. Otherwise Europe will become completely dependent on China for battery cells.”