Swedish battery maker Northvolt 鈥� backed by several major institutional investors 鈥� has filed for bankruptcy in its home country, citing its failure to secure a viable financial and operational future.
Northvolt, a sustainable battery cell and systems supplier founded in 2016, attributed its collapse to a combination of factors, including increased capital costs, geopolitical instability, supply-chain disruptions and shifting market demand.
鈥淔urther to this backdrop, the company has faced significant internal challenges in its ramp-up of production, both in ways that were expected by engagement in what is a highly complex industry, and others which were unforeseen,鈥� it added.
Tom Johnstone, interim chairman of Northvolt鈥檚 board of directors, said: 鈥淭his is an incredibly difficult day for everyone at Northvolt. We set out to build something groundbreaking 鈥� to drive real change in the battery, EV and wider European industry and accelerate the transition to a green and sustainable future.
鈥淭he outcome is especially hard considering not only the level of engagement and interest we held with potential partners and investors in recent months but also the clear improvement and upwards trajectory that we have been seeing in Northvolt鈥檚 production in Skellefte氓, where cell output from serial production lines has doubled and we have secured a 50% improvement in production yield since September.鈥�
Northvolt鈥檚 2023 financing round extension, which raised $1.2bn (鈧�1.1bn), was supported by institutional investors such as Sweden鈥檚 AMF, Canada Pension Plan Investment Board, Ontario Municipal Employees Retirement System, Investment Management Corporation of Ontario and BlackRock. The funding extended a $1.1bn convertible note from July 2022, earmarked for European and North American expansion.
Last November, , securing access to .
鈥淏y enabling the company to restructure its debt, appropriately scale the business to current customer needs and secure a sustainable foundation for continued operation, these Chapter 11 filings will help Northvolt to implement the decisions made as part of its strategic review to rescope the business and prioritise commitments to customers,鈥� the company said at the time.
Last month, Folksam, which owns a 0.7% stake in Northvolt, revealed in its 2024 annual results, that of its holding in the local battery firm during the period.
Meanwhile, AP2 and AP3 鈥� two of the four Swedish national pensions buffer funds which own a 3.5% stake in Northvolt via their joint venture 4 to 1 Investments 鈥� have reported that the holding was written down to zero.
Danish statutory pension fund ATP that the value of its 5.3% stake in Northvolt 鈥� previously worth DKK2.3bn (鈧�308m) 鈥� had become almost worthless.
Johnstone said: 鈥淲e are hopeful that the outreach we have undertaken with potential investors during the Chapter 11 process will accelerate identifying the necessary financing to allow continued trading under the Swedish bankruptcy process.
鈥淭he passion, dedication and innovation of our team has been nothing short of extraordinary, and we deeply regret that there is not a different path forward.鈥�
The challenges faced by Northvolt highlight the broader difficulties within the European battery manufacturing sector.
Notably, the UK has also experienced similar setbacks. Britishvolt, a UK startup that aimed to produce lithium-ion batteries for the automotive industry, entered administration in 2023.
This occurred after numerous failed attempts at rescue and takeover, effectively halting their ambitious plans for a 拢3.8bn (鈧�4.2bn) gigafactory in Blyth, Northumberland.
Rachel Fixsen contributed to this story
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