Northvolt building in Sweden, photographed in February 2022.
Mikael Sjöberg | Bloomberg | Getty Images
Swedish battery maker Northvolt said on Monday it would cut costs and find strategic partners while focusing on large-scale battery manufacturing to curb its rapid expansion.
The announcement follows a major review of Northvolt’s strategy aimed at refocusing the business after a series of setbacks including production delays and the cancellation of a large order in Germany. BMW>.
“These measures reflect the challenging macroeconomic environment and our
This will result in a re-evaluation of Northvolt’s near-term priorities,” the company said in a statement.
Northvolt said the cost cuts will include adjusting its workforce and suspending cathode active material production at Northvolt’s gigafactory in Skelleftea, Sweden.
The company did not elaborate on how it would adjust its workforce, saying it was in talks with unions and had not made a final decision.
“With the strategic review underway, we must take some tough actions to secure Northvolt’s operating fundamentals, thereby improving our financial stability and enhancing our operating performance,” the company said.
Northvolt is part of a wave of tens of billions of dollars in European startups investing in producing lithium-ion batteries, aiming to serve as the continent’s carmakers switch from internal combustion engine cars to emission-free electric vehicles.
But demand for electric vehicles is growing more slowly than some in the industry expected, and competition from battery producers and automakers in Asia and North America is fierce.
While Northvolt remains committed to building its planned gigafactories in Germany and Canada through a joint venture with Volvo Cars, as well as in Gothenburg, Sweden, those projects may face delays.
The company said that despite challenging market conditions, the long-term prospects for the industry remain strong.
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