The carmaker announced its surprising move on Wednesday. On takeover full control over the joint venture that Volvo Car created with Northvolt, which is having financial problemsthe automaker invokes its design repurchase rights NOVO Energybecause Northvolt had failed to meet its financial obligations.
“This action results from a breach of the partners’ agreement,” Volvo said in a statement. Spokeswoman Kristin Boldemann Wester declined to comment to Bloomberg on any financial details related to the ownership change.
Volvo will look for a partner
Volvo also said any future battery production at the site would depend on “the participation of a third party or other partner,” which suggests that Volvo has no plans to start producing batteries on its own. Wester told Bloomberg that It is not yet known who will be the partner who will manage the factory.
In a separate announcement Northvolt said it would not inject further capital into the joint venture. However, it will focus on other locations in Sweden, as well as planned factories in Canada and Germany.
“We remain in active and constructive dialogue with Volvo Cars on the future of NOVO Energy,” spokesman Martin Hofelmann said in comments emailed to Bloomberg.
NOVO Energy, a $2.8 billion investment
Volvo’s cooperation with Northvolt began in 2021, when the car manufacturer acquired 50 percent. shares of the battery manufacturer. The companies chose Gothenburg as the location to invest in the SEK 30 billion ($2.8 billion) plant. The new factory would produce battery cells specifically designed for use in all-electric Volvo and Polestar cars. Construction began in March and the target power rating was set at 50 gigawatt-hours, equivalent to batteries for approximately half a million electric vehicles per year. Production was scheduled to begin in 2026, the companies said at the time.
The production start timetable is currently being assessed and “there are different future scenarios” said Volvo’s Wester. She added that the carmaker has so far invested CZK 3 billion in the project.
