Northvolt invests $750 million in battery ecosystem
11 October 2021
Europe’s battery-manufacturing industry is experiencing a boom as the region strives to create a competitive and sustainable value chain that can keep up with market leaders in Asia. One of the companies driving European growth is the battery developer Northvolt.
The Swedish company has ambitious plans to build what it calls ‘the world’s first R&D campus’ to cover the entire battery ecosystem. Northvolt will invest $750 million (€649 million) to expand its laboratory facility in Västerås, Sweden, as demand for lithium-ion batteries continues to rise.
Sustainable batter solutions
The startup, co-founded in 2016 by former Tesla manager Peter Carlsson, wants the new campus to give customers access to ‘value-chain activities’ related to lithium-ion battery design, development and lifecycle. The battery manufacturer has already begun construction as it works towards producing next-generation cell technologies. It also plans to build a centre for customers to experiment with battery technologies and electrification.
‘There is today an irreversible momentum surrounding the switch to battery-electric solutions. Northvolt Labs is being expanded in order to capitalise on this – to drive the transition at even greater speed towards safe, sustainable battery solutions,’ said Carlson, Northvolt CEO.
‘By establishing a campus where industrial actors can engage, surrounded by all necessary facilities, it is our belief that we can create the necessary foundation for Europe to emerge as the leading region for a technology that is at the heart of the race to decarbonise,’ he added.
European supply chain
Scandinavia has become a key location for European battery production, with a focus on developing cheaper, resource-efficient battery-storage solutions for the market. Northvolt’s goal is to develop the world’s greenest battery cell and establish a sustainable European supply chain.
The company has won over notable backers like Volkswagen (VW). This year, the German car manufacturer invested $620 million in Northvolt as part of a larger $2.75 billion funding round. In 2019, VW had already poured €900 million into the Swedish battery manufacturer, which will start producing cells for VW’s electrically-chargeable vehicles (EVs) from 2023.
The recent funds raised by Northvolt will be used to expand the capacity of its Northern Swedish gigafactory in Skellefteå, from 40GWh to 60GWh per year, as consumer demand rises. ABB, BMW Group, Scania, Siemens, Vattenfall and Vestas, are some of the partners Northvolt works with. The battery developer also formed a joint venture with Volvo Cars this year, with the aim of establishing a new gigafactory in Europe that will begin production in 2026.
Northvolt’s latest announcement is evidence that the startup is accelerating its ambitions to become a world-leader in the field of battery development. The key facilities at its R&D campus will focus on industrialisation, battery systems development, and battery recycling. This, it hopes, will catapult Europe’s battery industry to the next level.
‘R&D, cell design and module development, battery recycling, manufacturing process development – these fields cannot proceed in isolation,’ said Yasuo Anno, Northvolt’s chief development officer. ‘By bringing all the parts of the puzzle together, on a single campus, we will be uniquely positioned to develop battery solutions for the global battery market.’