Swedish car maker Volvo Cars told its Novo Energy joint venture partner, battery maker Northvolt, that it will invoke its redemption rights to acquire Northvolt’s shares in the venture as it has not fulfilled its financing obligations. It has thus breached the parties’ shareholders’ agreement, it said.
Volvo Cars is evaluating the potential impact on Novo Energy and is investigating future scenarios to protect its investment, including multifunctional use of the building. Various options are under consideration, on the assumption Volvo Cars takes full ownership. Any battery production at Novo Energy is dependent on third party or other partner involvement, it added.
Northvolt spokesperson Martin Höfelmann told BEST the company has decided to stop contributing capital to the joint venture. It is prioritising its wholly owned cell operations in Skellefteå (Northvolt Ett), Västerås (Northvolt Labs), Heide (Northvolt Drei) and Montreal (Northvolt Six).
“The past year has brought notable change, with challenges to the overall EV market as well as our strategic review process,” he said. “We remain in active and constructive dialogue with Volvo Cars on the way forward for Novo Energy.”
Volvo Cars said it has a diversified and resilient battery supply chain and its vehicle roll-out plans will not be affected.
Separately, Portuguese energy company Galp said it was in no rush to make a final investment decision on a battery grade lithium refinery in Portugal, which was to be a joint venture with Northvolt.
CEO Filipe Silva said on Monday market conditions were “challenging”. Its Q3 earnings showed a 22% decline in adjusted core profit and grant funding is uncertain. The JV was set up in 2021 and was expected to announce an investment decision by end-2024.
