Battery manufacturing start-up Northvolt has raised US$1 billion for its planned Swedish gigafactory project— and has revealed it will build a second such facility in Germany in partnership with Volkswagen.
Northvolt said the equity capital raise for the lithium-ion battery cells plant at Skellefteå had been led by VW and Goldman Sachs Merchant Banking Division, alongside BMW, AMF, Folksam Group and IMAS Foundation.
The sum is in addition to a €350 million ($391m) loan approved earlier this year for the Swedish project by the European Investment Bank.
The Swedish company said “a part” of the cash raised will be invested in setting up a 50-50 joint venture with VW to build a 16GWh lithium-ion cells facility in Salzgitter, Germany.
Northvolt co-founder and CEO Peter Carlsson said the investments mark “a key moment for Europe that clearly shows that we are ready to compete in the coming wave of electrification, and that we will do so using battery cells which carry the lowest CO2 footprint possible”.
Building construction work at the Swedish plant will start in August with large-scale production estimated to begin in 2021.
The Germany project is scheduled to start manufacturing battery cells for VW’s electric vehicles from late 2023 or early 2024 and production could be increased to 24GWh over the following years, the partners said.
Since its official launch in March 2017, Northvolt has grown from 12 to almost 300 employees people. In 2018, Northvolt delivered its first product, a battery pack, to Epiroc’s fleet of underground mining machines, as well as producing its first battery cell. Currently, the company has an operational research lab and two cell factories under construction in Sweden – Northvolt Ett in Skellefteå and Northvolt Labs in Västerås, plus a battery systems factory in Poland that is already in production.