By Björn Jeffery, SvD Tech Brief. Published in Svenska Dagbladet on 12 March 2025.
Why Northvolt could not be saved is no mystery. A larger — and more important — question is why the company chose to grow so aggressively rather than first building a sustainable production operation. That question remains unanswered.
Northvolt AB’s board describes the past few months as “an exhaustive effort” to find “a viable economic and operational future.”
One might wonder if the company has ever done anything other than exactly that.
The story of Northvolt has been at least as much about financing as about batteries. And perhaps most of all about the absence of both.
Companies facing challenges with raising capital is nothing unusual in itself. Northvolt had a stock market listing in its sights and viewed it as the company’s natural long-term home. But market conditions around the world deteriorated and the company did not deliver as it should have. You cannot list a company whose factories have not even reached a fraction of their intended capacity.
The absence of batteries created an absence of financing.
To attempt to address this, Northvolt applied for restructuring in the United States in November 2024 — a so-called Chapter 11 process. That process has now failed. At the press conference, interim chair Tom Johnstone said he did not want to look backwards on this occasion but instead focus on the bankruptcy process here and now.
But a look backwards is appropriate, because the question now being asked is the same one many have been asking for many months: who was supposed to save Northvolt, exactly? Who was going to step forward and take responsibility for the long-term operations?
Johnstone gave an indirect answer to SvD: “no buyer has been interested in the entire unit.”
That is easy to understand. The operations consist of factories and factory projects around the world that are not functioning as intended. Rather than getting the factory in Skellefteå to reach its desired capacity — and only then expanding — Northvolt’s expansion plans appear to have been driven by opportunism. The green transition beckoned, and regions around the world saw an opportunity for a new wave of industrialisation: new, green jobs in a sector with its future ahead of it. Which local politician would turn that down? Northvolt struck while the iron was hot.
The warmth, however, was never greater than around the promises of what was to come.
The Northvolt Drei factory in Heide, Germany is now a construction site with an uncertain future. The 3,000 promised jobs will in all likelihood not materialise. Northvolt Six in Montreal is in a similar situation, even if those two subsidiaries are not currently in bankruptcy.
Finding a buyer willing to take on this mess always seemed improbable. There was no saviour — in the time of need or before it either.
Even if the opportunistic expansion complicated the business, there was always a clear solution to Northvolt’s problems. They needed to produce more batteries. Many, many more batteries. Their failure to do so is the simple core of what became the company’s downfall.
The difficulty of setting up this type of industrial operation in Sweden should not be underestimated. But precisely because it is so complex — why was more focus not given to solving that first? Why were operations, and their costs, scaled up so far before there was certainty about how to proceed?
Even today, we have no good answers to those questions. Acting opportunistically when the world shows great interest in your planned business is part of the explanation. But it is not sufficient as a complete one. One of Sweden’s largest ever corporate bankruptcies is now a fact, and thousands of employees have lost their jobs — staff who relocated from around the world and now sit in Skellefteå facing a deeply uncertain future. Over one hundred billion kronor in investments has been incinerated.
The responsibility rests heavily on both the company’s management and its board. The expansion was too fast, costs too high, productivity too low. Decisions about restructuring took too long — even though the need had been plainly visible for a considerable period. Whether there were grounds to believe a sustainable solution was within reach, we do not know today. Hope, as the saying goes, is the last thing to abandon us. Now even that has run out for Northvolt.
