Northvolt To Ramp Up EV Battery Production With Another $2.75 Billion
I’ve reported on electric vehicle battery production plans and battery supply chains extensively in the past year, interviewing many experts in the field. The core story is that electric vehicle (EV) should be skyrocketing in the coming decade (it already is in some places), and the battery supply chain looks like it is going to run behind demand a bit. In particular, battery mineral mining and processions facilities need several years to go from capital investment to production. Automakers (at the top of this chain) and battery manufacturers (in the middle) have to first give the signal to get to work extracting and processing those minerals.
A leader in this space, Northvolt, plays a special role. It was specifically formed, by a former Tesla exec no less, in order to fill gaps in this market, accelerate EV adoption, and basically just expand production capacity as quickly as practical while others dilly dally about forecasts and the firmest of orders. (See our podcasts from interviewing Northvolt CEO & cofounder Peter Carlsson at the bottom of the article.) As much more of the market has realized that, yes, electric vehicles really are ready to take over, Northvolt has been shining.
The news today is that Northvolt has just raised another $2.75 billion, and its planned production capacity for its Swedish gigafactory, Northvolt Ett, is being increased from 40 GWh (gigawatt-hours) to 60 GWh. The reason provided was: “increased customer demand.” As part of that, Northvolt mentioned a $14 billion order from Volkswagen Group earlier this year. The $2.75 billion will also help fund further R&D, but no specifics were provided.
The new investment round was led by Swedish investment funds AP1, AP2, AP3, AP4, and OMERS Capital Markets as well as Goldman Sachs Asset Management and Volkswagen Group (both of which were already major investors in Northvolt). Additional existing shareholders who participated in the investment round is an impressive list of its own:
- Baillie Gifford
- Baron Capital Group
- Bridford Investments Limited
- Compagnia di San Paolo
- Cristina Stenbeck
- Daniel Ek
- IMAS Foundation
- EIT InnoEnergy
- Norrsken VC
- PCS Holding
- Stena Metall Finans.
“We have a solid base of world-class investors and customers on-board who share Northvolt’s mission of building the world’s greenest battery to enable the European transition to renewable energy,” Carlsson said.
“We have been producing cells at our cell industrialization facility, Northvolt Labs, for more than a year and are excited to now bring the knowledge and technology we have developed to the north and start large-scale production.”
Getting back to the topic at the top, Northvolt also touched on the whole battery supply chain. They indicated that “Northvolt foresees tremendous growth in other parts of the European value chain for battery manufacturing; from processing of raw materials to component and equipment manufacturing, to production of battery cells and systems and the build-up of recycling infrastructure” by 2030.
“This is a new European industry in the making and it will require significant investments over the coming decade. It is encouraging to see that the investor community has identified the opportunity early, and we hope to see more investments throughout the value chain over the coming years,” said Alexander Hartman, CFO of Northvolt.
Northvolt plans to build two more battery gigafactories in Europe by 2030 … for now. As we hinted or directly said during our interview with Carlsson last year, as big as the plans look, we need much more. That should become increasingly clear, and this update on Northvolt’s significant expansion plans are already proof of that — not just the Kool-Aid-fueled words of a few cleantech journalists.
For more on Northvolt’s history and plans, here are articles and podcasts from our interview with Carlsson:
- CleanTechnica Interview With Peter Carlsson, CEO Of Northvolt: Part One — Background, Mission, & Unique Approach
- CleanTechnica Interview With Peter Carlsson, CEO Of Northvolt: Part Two — EV Market Growth, Timeline & Capacity, Cheap Hydropower
- CleanTechnica Interview With Peter Carlsson, CEO Of Northvolt: Part Three — Low-Carbon Advantage, Product Mix & Strategy