Northvolt does not give up and seeks funds to survive

It is said that 'hope is the last to die'. The Swedish company Northvolt, a promising manufacturer of 'made in the EU' batteries for electric cars, is in fact trying to overcome the crisis it ran into a few months ago when it had to file for bankruptcy in the United States, struggling with a declining car market.

Now, however, the company's owners - which include Volkswagen and Goldman Sachs - are voting to continue operations and, in the meantime, go on the hunt for financiers to ensure the company's survival.

"This is a positive outcome that demonstrates the support of our shareholders as we strive to realise our ambition and maximise our value," the Scandinavian manufacturer said after the meeting, via an email reported by Reuters.

"Northvolt continues to make progress in the restructuring process while increasing production and advancing its transformation."

Electric car with Northvolt batteries

Recap

The company is founded in 2015 by two former Tesla executives and is set to become the largest manufacturer of environmentally friendly batteries in Europe. The project receives great support from the European institutions, echoed by a number of large groups such as Volkswagen, BMW and Volvo.

At the end of 2021, Northvolt shows the world the first cell produced in its Skelleftea factory. The company then looks elsewhere to build more gigafactories, starting with North America, where Canada allocates almost €1 billion to facilitate construction in 2023.

But in August 2024, the first alarming news arrives: Northvolt is slowing down its expansion plans in order to get its accounts in order and reduce a €1 billion deficit. So it closes its R&D centre in California (leaving everyone at home) and confirms that it is behind schedule. So late that BMW cancels a €2 billion order because the cells have not arrived.

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In September, Northvolt takes further action to counter the crisis and announces 1,600 redundancies, while in November it files for bankruptcy under US law, with the aim of protecting itself from creditors and continuing operations, in the hope of restoring its balance sheet. Will it succeed?

More on the matter:

Porsche and Audi's next EVs could be late

Northvolt lays off workers to avoid closure, but production increases

Europe's battery crisis continues

Northvolt raised $1.1 billion to support expansion in Europe

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