Northvolt files for bankruptcy in Sweden
By Abigail Townsend
Date: Wednesday 12 Mar 2025
(Sharecast News) - Battery firm Northvolt has filed for bankruptcy in Sweden, it confirmed on Wednesday, effectively ending Europe's hopes of establishing a credible challenge to China.
The Swedish start-up makes batteries for electric cars, a market currently dominated by China.
Hopes of establishing a viable European rival saw backers such as Volkswagen, Goldman Sachs and the Swedish government invest billions.
However, Northvolt has suffered a number of external and internal setbacks in recent years, causing both losses and debts to mount. In November it filed for Chapter 11 bankruptcy protection in the US, and on Wednesday confirmed it would be filing for bankruptcy in Sweden as well.
The manufacturer said it had pursued a number of possible options in recent months but had failed to secure the "necessary financial conditions" to continue in its current form.
Tom Johnstone, interim chair, said: "This is an incredibly difficult day for everyone at Northvolt.
"For me personally, it remains key for Europe to have a homegrown battery industry, but it is a marathon to build such an industry. It needs patience and long-term commitment from all stakeholders.
"We are hopeful that the foundation we built - the technology, the expertise and the commitment to sustainability - will continue to drive change in the industry."
Northvolt, which was founded in 2016 by Peter Carlsson and fellow ex-Tesla Motors executive Paolo Cerruti, made a net loss of $2.1bn in 2023 and had $2.1bn of cash. By the time it filed for Chapter 11, however, it had just $30m of cash while debts were $5.8bn.
Carlsson resigned as chief executive a day after the company filed for Chapter 11, while Cerruti stepped down as head of the North American division in January.
The firm said it had experienced a "series of compounding challenges" in recent months - including higher capital costs, geopolitical instability and changing market demand - alongside "significant" difficulties in the ramp up of production.
A Swedish court-appointed trustee will now oversee the bankruptcy, including a potential sale of the business and settlement of any outstanding obligations.
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