Consequences of the bankruptcy of Swedish battery manufacturer Northvolt

Northvolt, founded in Sweden in 2016 by former Tesla executives, made a big promise: to create its own battery plant in Europe, using only green electricity. Investors lined up and poured hundreds of millions of dollars into the company. The car industry was also generous. Volkswagen was the largest shareholder among all investors, investing €1.4 billion , giving it a 20 percent stake in the company and a seat on the supervisory board. But the money disappeared. Northvolt, which at one point employed 7,000 people, is now insolvent.

The construction of the battery factory in Heide on the German North Sea coast was financed with 600 million euros. The site is still a construction site with no end in sight. The German federal government and the state of Schleswig-Holstein guaranteed half of the loan. This money is probably irrecoverable. Only BMW withdrew from the cooperation in time. The Bavarians canceled their billion-dollar order for batteries from the factory being built in Germany in the summer of 2024. At that time, it was expected that Northvolt's ambitious production schedule would not be met. Even then, Northvolt's CEO Peter Carlsson admitted in an interview with Dagens industri that the company's expansion plans were "too aggressive."

When Northvolt filed for bankruptcy, its debt amounted to $5.8 billion.

In addition to Volkswagen, Northvolt's insolvency could also affect Volkswagen's subsidiary Scania. The truck manufacturer has staked everything on Northvolt to make the brand's electric future a reality. Now the Scandinavians have bought the industrial division of Northvolt Systems from the bankruptcy estate. It employs around 300 people at a prototype plant in Stockholm, Sweden, and a production plant in Gdansk, Poland. The prototype batteries are used in construction machinery and drilling rigs. It is not known what price Scania paid. In addition to its headquarters in Stockholm, Scania now also has a cell production facility in Skelleftea in northern Sweden and the Northvolt Labs research and development campus in Västerås, Sweden. Volvo, on the other hand, has taken over the Novo Energy joint venture in Gothenburg.