- Swedish EV battery manufacturer startup, Northvolt, which includes significant shareholders such as Volkswagen, Scania, and Goldman Sachs, has filed for bankruptcy in the country.
- It follows Northvolt filing Chapter 11 bankruptcy in the U.S., back in November
- The company cited external pressures, such as ‘geopolitical instability’ and ‘shifts in market demand’, but also internal challenges it was facing regarding ramping up of battery production.
Sweden’s Northvolt files for bankruptcy
Following Northvolt’s bankruptcy filing, a Swedish court-appointed trustee will oversee the selling of the business, along with its assets, while outstanding obligations to clients will also be settled.
This bankruptcy filing was not a complete shock, with recent events hinting that such an event could be imminent. Last September, it laid off approximately 20% of its workforce, while it had also been failing to deliver on its own battery production targets – producing around 20,000 cells a week, below its targeted weekly production of 100,000 cells. These production delays were given as one reason for BMW to cancel its supply contract for batteries from Northvolt last year, with the manufacturer instead reaching out to South Korea’s Samsung SDI for cells.
Scania, both a shareholder and customer of Northvolt, had already been making preparations earlier this week to secure battery supply from other firms, to continue its BEV push. While not specifically naming those new suppliers, Scania confirmed to Reuters on Monday, ahead of today’s bankruptcy filing, that the manufacturer had now ‘secured future deliveries of battery cells’ from alternative suppliers.
Many in the emobility industry saw Northvolt as one of Europe’s potential answers to becoming less dependent on EV batteries from manufacturers such as BYD and CATL in China, and LG Energy Solution and Samsung SDI in South Korea. Northvolt’s bankruptcy will be seen as a significant setback to this goal.
Tom Johnstone, Interim Chairman of Northvolt’s Board of Directors, commented:
“This is an incredibly difficult day for everyone at Northvolt. We set out to build something groundbreaking — to drive real change in the battery, EV and wider European industry and accelerate the transition to a green and sustainable future. The outcome is especially hard considering not only the level of engagement and interest we held with potential partners and investors in recent months, but also the clear improvement and upwards trajectory that we have been seeing in Northvolt’s production in Skellefteå, where cell output from serial production lines has doubled and we have secured a 50% improvement in production yield since September.”
Johnstone continued:
“For me personally, it remains key for Europe to have a homegrown battery industry, but it is a marathon to build such an industry. It needs patience and long-term commitment from all stakeholders.”
