Northvolt to ramp up production capacities
Northvolt’s plans to build capacity for the production of battery cells in Europe appear to be more extensive than previously stated. The planned production capacity is to increase significantly – also with new partners.
As Northvolt CEO Peter Carlsson told the Financial Times, the Swedish company is aiming for production capacities of around 150 GWh and a market share of 25 per cent in Europe by 2030. “There is no doubt that our ambitions go far beyond 64 GWh,” Carlsson told the paper.
The 64 GWh correspond to the projects announced so far: The company’s planned factory in Skellefteå, Sweden, is to start up in 2021 with a capacity of 32 GWh and be expanded to 40 GWh by 2024. The joint factory with Volkswagen in Salzgitter is to be opened at the end of 2023 with a production capacity of 16 GWh and expanded to 24 GWh at a later date. Pilot production began there in September.
In June, Volkswagen “initially” acquired a 20 per cent stake in Northvolt and invested a total of 900 million euros – but it was not broken down how much VW paid for the 20 per cent share and how much went into the joint venture for battery cell production.
Carlsson: “Open for cooperation”
In order to achieve the new plans and grow rapidly, Northvolt is open to further partners and joint ventures, according to Carlsson. “In any case, we are open to various collaborations in order to scale further,” said the former Tesla manager. “If we want this transition to happen quickly, we need to partner with people who can make it happen.”
How attractive this is for other carmakers in view of the VW stake remains to be seen. In addition, VW can obviously envisage further expanding the partnership. “If we needed more capacity in a second stage after 2025, then we could also go to Emden with a partner like Northvolt, for example,” VW Board Member Stefan Sommer recently said in an interview with local media. But nothing has yet been decided about the second VW Northvolt factory.
Carlsson has already found a new partner outside the VW Group, albeit not for a cell factory: Northvolt has signed a cooperation agreement with the Swedish energy supplier Mälarenergi to jointly set up a battery storage system at a charging station for electric vehicles in Västerås, Sweden. It is scheduled to go into operation in the summer of 2020.
No public IPO planned
Carlsson intends to do more than build stationary battery storage units. Even in view of the plans and the financial requirements, Carlsson is not aiming for an IPO, that is “not in sight”. Now is the time to show his industrial partners and European decision-makers that they can build their factories as planned. “For the foreseeable future, we are well capitalised. We know what we have to execute,” he added.
After years of hesitation, we are slowly moving into battery cell production in Europe. LG Chem operates a 15 GWh production facility in Poland, Chinese competitor CATL is currently building its European plant near Erfurt (up to 24 GWh planned). But other cell manufacturers are also producing in Europe. In addition, several European consortia are still applying for funding, and the first projects are scheduled to start this year.