Volvo set to buy out Northvolt from Gothenburg battery project

Volvo Cars has announced that it has initiated a buyout of Northvolt joint venture to build a battery factory in Gothenburg to take full ownership.

Northvolt has struggled with its plans to create multiple battery manufacturing hubs and is raising a rescue package as it fights for its long-term future.

The Swedish carmaker, owned by China’s Geely, said it planned to invoke its redemption rights to fully own Novo Energy from its current 50-50 partner Northvolt.

Northvolt has previously announced that it had decided not to contribute more capital to Novo Energy. Instead, it focused its funding on its sole factory in northern Sweden, where it has fought to increase production.

Volvo added that the “building could be multifunctional” and that “any battery production at Novo Energy is dependent on third-party or other partner involvement” but did not indicate which companies were involved.

Volvo Cars also said it “intends to have a constructive dialogue with Northvolt on the matter.”

Previously, Northvolt announced 1,600 redundancies at its Skellefteå site in Sweden. It also closed operations in Cuberg, shifting lithium metal battery R&D to Sweden.