VW allegedly sets up task force on Northvolt problems

According to the German publication Automobilwoche, Volkswagen has set up an internal task force due to the problems at Northvolt’s battery cell plant in northern Sweden. The aim is to check whether the battery startup is able to deliver and whether it would be necessary to reorganise in an emergency. However, Volkswagen has not officially commented on any of this.

The problems in northern Sweden could even affect the planned factory in Heide/Schleswig-Holstein. Speculation ranges from a postponement of the planned plant construction to a general withdrawal. However, no final decisions have been made yet. Construction of the planned factory just started a few months ago, with the first battery cells planned for production by 2026.

It was announced in mid-June that the contract with BMW was being dissolved, which had originally seen Northvolt supply BMW with battery cells worth two billion euros. Two reasons were cited: Firstly, the quality of the cells supplied by Northvolt is “not yet as expected”, although no further details were provided. The second reason was the timing: Northvolt only has one factory in Sweden in operation so far, all other plants, such as the one mentioned above in Germany, or one in Canada, are still in the planning stage.

The question has been posed whether Northvolt is expanding too quickly, and is unable to keep up with production and quality. Northvolt CEO Peter Carlsson recently told the publication Dagens industri that the expansion plans had been too aggressive and now needed to be reviewed. The company needs to concentrate on the core of its business. The sluggish production in Skellefteå is a key issue in this respect. How this review will affect Northvolt’s plans is still unclear, however. “Northvolt is currently evaluating the timing of the further production ramp-up of its factories,” a company spokesperson stated.

For the planned factory in Heide, Germany, the EU Commission had approved a German subsidy of 900 million euros for the construction of the cell factory. The battery cell factory is expected to create around 3,000 jobs and was considered an important supply line for European OEMs, who face competition from China. Another multi-billion dollar loan to help the battery manufacturer get its factories running was approved shortly afterwards. Peter Carlsson, co-founder and CEO of Northvolt commented: “It will enable us to realize the full potential of Northvolt Ett and demonstrates that circular, sustainable business practices are fundamental to success in today’s industry.” German chancellor Olaf Scholz, who was present at the ceremony stated: “Investments like Northvolt’s are of strategic importance for our country and for Europe. Germany was, is and will remain a strong industrialised country.”

automobilwoche.de (in German)