Swedish electric battery manufacturer, Northvolt, will be slowing down its international expansion plans to concentrate efforts on its “gigafactory” in northern Sweden, CEO Peter Carlsson announced on Tuesday.
Scaling Back Ambitious Global Plans
Northvolt has a multi-billion euro project for a giant factory in northern Germany and another in Canada with an initial investment of 5 billion euros. The Swedish group also has another factory project in Gothenburg (southwest).
“In the current situation, we are looking to focus more on the heart of our business. To move forward in Germany and Montreal, it is essential that Skellefteå is the mother plant on which the plan is based,” said Carlsson in an interview with the business daily Dagens Industri.
Reassessing Next Steps
“Now that we are behind schedule, we need to review the next steps, and that’s what we’re working on right now,” he added.
Carlsson declined to provide a new development timeline, referring to a strategic review in September.
“We have been a bit too aggressive in our expansion plan, and that’s what we are reviewing,” he admitted.
Production Delay in Sweden
In Sweden, the production of battery cells at its giant factory in northern Sweden will reach full capacity in the first phase in 2026, compared to the initial target of 2023, explained the head of Northvolt.
“Next year, all production lines should be ready to produce, but depending on the ramp-up of customer programs and capacity development, we will produce a handful of gigawatts in 2025, and in 2026, we will reach full capacity utilization and then also achieve profitability in Skellefteå,” he said.
Industry Challenges and Competition
The automotive industry is facing slower growth in demand for electric vehicles and, simultaneously, increasingly fierce competition, which is impacting battery factory projects.
The Swedish group also denies that it wanted to develop too quickly at the expense of safety. Swedish police are investigating a possible link between three deaths of people who were employed at the battery manufacturer’s first site.
“The idea that it would be dangerous to work at Northvolt seems totally foreign to me. I am convinced that we are a safe and secure workplace,” said the group’s boss.
Northvolt’s Role in Europe’s Battery Landscape
Northvolt is one of the great European hopes in the battery sector at a time when the Old Continent is seeking to catch up with Asian and American giants.