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| Northvolt files for bankruptcy protection in blow to Europe’s EV ambitions | Northvolt files for bankruptcy protection in blow to Europe’s EV ambitions |
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| Swedish maker of battery cells for electric vehicles says it has enough cash to support operations for only a week | Swedish maker of battery cells for electric vehicles says it has enough cash to support operations for only a week |
| Northvolt, the Swedish maker of battery cells for electric vehicles, has filed for Chapter 11 bankruptcy protection in the US, dealing a blow to Europe’s hopes that its most developed battery player would reduce western carmakers’ reliance on Chinese rivals. | |
| Northvolt said it had enough cash to support operations for only about a week and it had secured $100m (£80m) in new financing for the bankruptcy process. It said operations would continue as normal during the bankruptcy. | Northvolt said it had enough cash to support operations for only about a week and it had secured $100m (£80m) in new financing for the bankruptcy process. It said operations would continue as normal during the bankruptcy. |
| “Northvolt’s liquidity picture has become dire,” the company said in its Chapter 11 petition, filed in a bankruptcy court in Houston. Northvolt, which has operations in California, has about $30m in cash and about $5.8bn of debts. | “Northvolt’s liquidity picture has become dire,” the company said in its Chapter 11 petition, filed in a bankruptcy court in Houston. Northvolt, which has operations in California, has about $30m in cash and about $5.8bn of debts. |
| The company, which employs about 6,600 staff across seven countries, expects to complete the restructuring by the first quarter of 2025. | The company, which employs about 6,600 staff across seven countries, expects to complete the restructuring by the first quarter of 2025. |
| In September, Northvolt said it would cut 1,600 jobs in response to “headwinds” blowing through the electric car industry. | In September, Northvolt said it would cut 1,600 jobs in response to “headwinds” blowing through the electric car industry. |
| Within months, Northvolt transformed from Europe’s best shot at a homegrown EV battery champion to a company struggling to stay afloat by slimming down, hobbled by production problems, the loss of a big customer and a lack of funding. | Within months, Northvolt transformed from Europe’s best shot at a homegrown EV battery champion to a company struggling to stay afloat by slimming down, hobbled by production problems, the loss of a big customer and a lack of funding. |
| Europe has been hoping that Northvolt would reduce western carmakers’ reliance on Chinese rivals such as the battery maker CATL and the EV and battery maker BYD. | Europe has been hoping that Northvolt would reduce western carmakers’ reliance on Chinese rivals such as the battery maker CATL and the EV and battery maker BYD. |
| Northvolt said the $100m was part of $245m in financing support for the bankruptcy. The Swedish truck maker Scania, a shareholder and its biggest customer, has said it will loan $100m to Northvolt to support the manufacturing of EV battery cells in Skellefteå, northern Sweden. | Northvolt said the $100m was part of $245m in financing support for the bankruptcy. The Swedish truck maker Scania, a shareholder and its biggest customer, has said it will loan $100m to Northvolt to support the manufacturing of EV battery cells in Skellefteå, northern Sweden. |
| Tom Johnstone, the interim chair of Northvolt’s board, said: “This decisive step will allow Northvolt to continue its mission to establish a homegrown, European industrial base for battery production.” He also noted the support the company had received from lenders and customers. | |
| As part of the restructuring, Northvolt would evaluate proposals for new money investment from strategic and financial investors, as well as existing lenders, shareholders and customers, he said. | As part of the restructuring, Northvolt would evaluate proposals for new money investment from strategic and financial investors, as well as existing lenders, shareholders and customers, he said. |
| The investment group Vargas, a co-founder of Northvolt and one of its largest shareholders, said the bankruptcy would allow the company to address financial challenges and maintain its competitive edge in producing high-performance battery cells. | The investment group Vargas, a co-founder of Northvolt and one of its largest shareholders, said the bankruptcy would allow the company to address financial challenges and maintain its competitive edge in producing high-performance battery cells. |
| Northvolt has led a wave of European startups investing tens of billions of dollars in battery production to serve the continent’s automakers as they switch from internal-combustion engines to EVs. | Northvolt has led a wave of European startups investing tens of billions of dollars in battery production to serve the continent’s automakers as they switch from internal-combustion engines to EVs. |
| But EV demand is growing at a slower pace than some in the industry had projected, and competition remains stiff from China, which controls 85% of global battery-cell production, according to International Energy Agency data. | But EV demand is growing at a slower pace than some in the industry had projected, and competition remains stiff from China, which controls 85% of global battery-cell production, according to International Energy Agency data. |
| The Swedish deputy prime minister, Ebba Busch, said on X that the government continued to support the EV battery industry and it hoped the restructuring would help turn around Northvolt’s fortunes. | The Swedish deputy prime minister, Ebba Busch, said on X that the government continued to support the EV battery industry and it hoped the restructuring would help turn around Northvolt’s fortunes. |