Video source: YouTube, Northvolt
Volvo Car Group is forming a joint venture with Swedish battery manufacturer Northvolt to build a new gigafactory in Europe and develop sustainable batteries for the premium automaker and its electric-only sister brand Polestar.
Under the partnership announced Monday, the companies will build a plant with capacity of up to 50 gigawatt hours per year — enough to power about 500,000 cars — that will start production in 2026.
They will also set up a research and development center next year in Sweden to start developing batteries purely for Volvo.
Northvolt, which was founded by former Tesla Inc executives, is backed by investors including Volkswagen and The Goldman Sachs Group and has contracts worth billions with Bayerische Motoren Werke AG and Scania AB.
As part of the joint venture, Northvolt will become the exclusive battery cell production partner in Europe for Volvo Car Group, a unit of China's Zhejiang Geely Holding Group Co Ltd.
According to Reuters, Northvolt raised $2.75 billion in equity earlier this month to expand capacity at a battery plant it is building in northern Sweden, a facility from which Volvo plans to source battery cells starting in 2024.
The new partnership, Volvo said, is key in helping the automaker achieve its goal of selling only fully electric vehicles by 2030 and advance Polestar’s effort to create a “truly climate neutral vehicle” by 2030.
“By working with Northvolt we will secure a supply of high-quality, more sustainable battery cells for our pure electric cars,” said Håkan Samuelsson, Volvo’s chief executive officer, said in a statement. “Working closely with Northvolt will also allow us to strengthen our in-house development capabilities.”
“Volvo Cars and Polestar are industry leaders in the transition to electrification and perfect partners on the journey ahead as we aim to develop and produce the world’s most sustainable battery cells,” said Peter Carlsson, Northvolt’s co-founder and chief executive officer. “We are proud to become their exclusive battery cell production partner in Europe.”
The deal has yet to be signed and approved by the boards of Volvo and Northvolt, according to the press release issued Monday.
As European carmakers are ramping up efforts to become less dependent on battery production from Asia, Northvolt has set its sights on becoming Europe’s largest producer of electric car batteries, the Financial Times noted.
Carlsson told the publication the company was also looking to expand its battery operations into the US and Asia.
Source: Equities News