Swedish battery giant announces 1,600 job cuts in the country. Here’s everything you need to know!
Northvolt, the Swedish manufacturer of batteries for electric vehicles, recently announced the 1,600 jobs to be cutor about a quarter of its workforce in Sweden. The move follows some of the financial challenges the company is facing as well as a drop in demand for electric vehicles. Among the most affected sites is Skelleftea’s giant factorylocated in northern Sweden, where around 1,000 jobs will be cut. The company also mentioned that its expansion plans at the same plant would be put on hold for the time being.
The company has been facing cash flow problems for several months. Northvolt would need a $735 million capital injection to avoid a financial crisis. Despite significant support from customers such as Volkswagen, which is also its largest shareholder (21% you capital), the company has faced significant production delays. This has prompted some customers, such as BMW, to cancel major orders due to these operational difficulties.
Another blow for the old continent…
Northvolt, created in 2016is one of the largest European companies in battery manufacturing. However, the accumulated delays by Northvolt in recent months, have made the company’s financial situation very fragile. As mentioned above, the slowdown in the electric vehicle market has also played a role in this crisis.
The company has however raised $15 billion of funding since its inception, but this has not been enough to compensate for production delays and difficulties in meeting commitments to its customers. Sweden, where Northvolt is headquartered, has refused to intervene financially to support the company, saying that there were no plans for the state become a shareholder. To avoid a financial hemorrhage, Northvolt has also postponed its plans for factories abroad, notably in Canada and Germany. This news is a new blow for Europe, which is seeking to reduce its dependence on Asian giants in the field of batteries.
A truly strategic area in the transition to 100% electric.
Source: www.autoplus.fr
