Northvolt lays off workers to avoid closure, but production increases

The Swedish company will be cutting 1,600 jobs. But at its Skelleftea plant, it will be producing more cells to satisfy customers.

By: Francesco Barontini

Sep 25, 2024 at 4:03am ET

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Northvolt like Volkswagen: getting out of the crisis means cutting jobs. Europe's largest battery manufacturer is to make 1,600 people redundant in response to falling demand for batteries as a result of the difficult situation in the electric car market.

Of these, 1,000 currently work at the Skelleftea plant in Sweden, while the rest are spread across different production complexes and locations. This is a bad move, given that, according to a report dating from the end of 2023, the company had 5,800 employees.

From halted growth to contraction

Northvolt recently stated that expansion plans at its main plant, Northvolt Ett in Skelleftea, had been put on hold in order to respond quickly to the changing economic situation.

After claiming that it had been forced to close its Californian R&D centre to cut costs, the company is now even cutting its workforce to avoid letting its financial situation collapse.

Batterie sodium-ion de Northvolt

However, production is increasing

The idea is to put an end to secondary activities and concentrate on increasing production volumes in order to meet the commitments made to carmakers who have placed orders for cells for their electric cars. These are mainly Volkswagen and Volvo.

In short, we don't want another BMW affair. The German manufacturer recently cancelled an order worth €2 billion because of delivery delays. A major blow for Northvolt.

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The idea now is to increase production at the current plant to its full capacity of 16 GWh per year. However, it will not build the other lines planned, which would have brought the Skelleftea Gigafactory up to a capacity of 30 GWh.