Swedish Northvolt is now under such pressure that, like the car brand Fisker Inc. has sought bankruptcy protection in the United States.
The Swedish battery manufacturer Northvolt has filed for bankruptcy protection in the United States.
The company states that it will continue to operate its business during a planned reorganization that will ensure adaptation to current market conditions and customer needs.
In recent years, Northvolt has worked to establish itself as a significant player in the European battery industry.
The company has had great ambitions to compete with Chinese manufacturers on the market. Despite these goals, the company has been under financial pressure, which in September resulted in the dismissal of 1,600 employees – corresponding to a quarter of the workforce.
Several large investors have money tied up in Northvolt. Among the owners are international car manufacturers such as BMW and Volkswagen, as well as a number of pension companies and investment companies.
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However, BMW has torn up a contract worth 14 billion Danish kroner in the middle. Volkswagen, which is Northvolt's largest shareholder, is considering doing the same. The brand from Wolfsburg has already resigned from the board of the battery factory.
In Denmark, ATP has invested more than two billion kroner in the company, while PFA Pension and Danica Pension have made three-digit million sums available as loans.
Bankruptcy protection in the US is to create a temporary break in the debt obligations, so that Northvolt can work on a financial and strategic restructuring.
The company sees it as a necessity to be able to continue operations and meet the challenges it faces.
The economic problems come at a time when the battery industry in Europe is generally experiencing increasing competition from Asian manufacturers and pressure from high production costs.
Outside the world, however, other battery manufacturers cannot say no to the crisis atmosphere. South Korean SK On, which supplies battery packs for Hyundai, Kia, Ford, Ferrari and Polestar, already announced in July that the business is on the verge of bankruptcy.
Northvolt has previously tried to position itself as one of the actors who would be able to make Europe less dependent on the Chinese battery giants. But the current challenges have put the company's viability into question.
It is still unclear what consequences the bankruptcy protection will have for the company's investors and employees. Or how the company's finances look now. As recently as September, however, the battery company was just one day away from bankruptcy. Read more about it here .
