Battery maker Northvolt files for bankruptcy in Sweden

Swedish electrical automobile battery maker Northvolt has filed for bankruptcy in Sweden after failing to safe financing to allow it to proceed operations, the struggling firm stated Wednesday.

Based in 2016, Northvolt was as soon as seen as a cornerstone of European makes an attempt to meet up with Asia and america in the manufacturing of battery cells, the essential element of zero-emission automobiles.

However the firm has struggled below a mountain of debt, gradual demand and manufacturing delays, which in Might 2024 led automobile producer BMW to drop an order price two billion euros ($2.2 billion).

Northvolt stated in an announcement Wednesday that regardless of pursuing “all accessible choices to barter and implement a monetary restructuring … the corporate was unable to safe the mandatory monetary situations to proceed in its present kind.”

Northvolt utilized for Chapter 11 bankruptcy safety in america in late November to allow it to restructure its debt and reorganize its enterprise.

The battery maker stated in US filings that it owed $5.8 billion.

Northvolt stated “a Swedish court-appointed trustee will now oversee the method, together with the sale of the enterprise and its belongings and settlement of excellent obligations.”

‘Compounding challenges’

In January, shareholders agreed at a rare common assembly to permit the financially-strained firm to proceed working.

Northvolt’s two largest shareholders are German carmaker Volkswagen—additionally in monetary issue—and US funding financial institution Goldman Sachs.

“Like many firms in the battery sector, Northvolt has skilled a sequence of compounding challenges in latest months that eroded its monetary place,” the corporate stated.

It cited “rising capital prices, geopolitical instability, subsequent provide chain disruptions, and shifts in market demand.”

The battery maker pressured that in its makes an attempt to safe financing it had discovered “important traction with potential companions and curiosity from traders.”

“Nonetheless, with restricted time and monetary assets accessible, the corporate was unable to conclude the mandatory agreements to safe its future,” Northvolt stated.

It additionally stated that its German and North American subsidiaries weren’t submitting for bankruptcy in their respective jurisdictions.

No state rescue-

In September, the Swedish firm stated it was slashing 1,600 jobs—1 / 4 of its workers—and suspending the enlargement of its Skelleftea website in northern Sweden.

It additionally stated it was slashing plans to increase the manufacturing capability of its facility to 30 gigawatt-hours per 12 months.

In July of 2024, it stated it hoped to succeed in an annual manufacturing of over one GWh this 12 months—effectively under the power’s supposed capability of 16 GWh.

One GWh is sufficient to equip 20,000 average-sized automobiles.

In mid-September, Swedish Prime Minister Ulf Kristersson dominated out a authorities rescue, saying “there aren’t any plans for the Swedish state to develop into an element proprietor of Northvolt or something like that.”

Europe accounts for simply three % of world battery cell manufacturing, however has set its sights on 25 % of the market by the tip of the last decade.

“For me personally, it stays key for Europe to have a homegrown battery trade, however it’s a marathon to construct such an trade. It wants persistence and long-term dedication from all stakeholders,” Northvolt interim chairman Tom Johnstone stated in an announcement.

The corporate stated it had not too long ago accomplished its first a million battery cells to an unspecified European buyer.

The bankruptcy may have a extreme social influence in northern Sweden, the place Northvolt—which employs about 5,000 individuals—had concentrated its operations.

“It’s in fact a heavy message and a really darkish day for all of us who’ve labored onerous each day and hoped that the corporate would get by means of this robust time,” Shaneika Jeffrey, a consultant of the labor union Unionen, stated in a remark.

© 2025 AFP