Northvolt files for bankruptcy in Sweden. Yet another blow to the European battery sector (by Marco Minossi)

Northvolt, the Swedish company that aimed to become a leader in the production of lithium-ion batteries, has declared bankruptcy. The news has shaken the battery industry and raises questions about the future of the respective European production.

The text is by Marco Minossi, the parts in italics are ours. The bankruptcy of the Swedish Northvolt comes after the bankruptcy of the German subsidiary . End of games.

The causes of the failure appear to have been:

• High production costs: Northvolt faced high production costs, particularly for raw materials and energy. This is ironic, considering that it was created precisely to guarantee an energy transition at acceptable costs
• Asian Competition: The company has struggled to compete with Asian manufacturers, which have lower production costs and greater experience.
• Production Delays: Northvolt experienced delays in the construction of its factories, which negatively affected its revenue. Contracts with large automotive groups have fallen through.
• Difficulty in raising financing: The company had difficulty raising the necessary financing to expand production.

The consequences of failure are:

• Job losses: Northvolt's bankruptcy will lead to the loss of thousands of jobs in Norway and other European countries.
• Delay in energy transition: The company's bankruptcy could slow the transition to green energy in Europe, as batteries are essential for the electrification of transport and storage of renewable energy.
• Greater dependence on Asia: Northvolt's bankruptcy could increase Europe's dependence on Asian battery makers.

Therefore, regarding the future of European battery production, Northvolt's bankruptcy is a wake-up call for the European battery industry.

Greater support from governments and investors is needed to ensure that Europe can compete with Asian producers, but this support currently seems firmly focused in an entirely different direction, both as a political and financial commitment.

Or, wanting to give a different vision, we need to let the market make its own way, rather than forcing the energy transition. Perhaps by imposing duties on batteries imported from China, to compensate for competitive disadvantages, but not making contributions to the forced electrification of mobility and financing, at most, research and prototyping.

Article Northvolt files for bankruptcy in Sweden. Yet another blow to the European battery sector (by Marco Minossi) comes from Scenari Economici .

This is a machine translation of a post published on Scenari Economici at the URL https://scenarieconomici.it/northvolt-dichiara-fallimento-in-svezia-lennesimo-duro-colpo-al-settore-batterie-europeo-di-marco-minossi/ on Thu, 13 Mar 2025 06:35:34 +0000.