Andre Giamarino’s Post

Northvolt, once heralded as Europe’s great hope for #EV battery production, is now at a crossroads, facing potential Chapter 11 or bankruptcy. Despite securing over $15bn in funding from major players like Volkswagen Group and Siemens, and enjoying government subsidies, Northvolt has struggled to scale production at its flagship factory in Sweden. The collapse of a $2bn BMW Group contract and widespread operational challenges have brought the company to a crisis point. With a quarter of its workforce cut and projects shelved, Northvolt’s story reflects the immense difficulties in breaking the dominance of Asian battery manufacturers. For Europe’s green transition, this is more than just one company’s struggle, it’s a crucial lesson. Bold visions require equally robust execution strategies, and collaboration across stakeholders is key. Should governments and investors do more to support pioneering green tech, or are market forces simply at play here? Share your thoughts. #northvolt #batterytech #greenenergy #automotive #automotiveindustry #autoindustry #auto #automobile #carindustry #carmanufacturers #automanufacturers #automotivemanufacturers #battery

A big blow to Europe's #EV industry - Northvolt's financial crisis can spell more hardships for the sector. #European #EV market was already under pressure due to slower than expected growth in demand and heavy reliance on #Chinese imports. Northvolt was key to Europe's self-reliance as battery technology is strategically important (especially considering the geopolitical volatilities) but it has failed to scale up production compared to Chinese players that control 85% of the global production. This points to a bigger risk to Europe's #green transition as the lack of robust domestic production capabilities may lead to #supplychain security and cost risks. What are the other implications across the value chain? How can businesses be on top of the latest industry developments, and realign their strategies? Benori provides #marketintelligence and #competitorintelligence across industries to enable strategic decisions. Reach out to us at [email protected] or [email protected] to know more about how we can support your business needs. https://lnkd.in/dY9qihm4

Electric cars and batteries, the bankrupt giant: the reason and the consequences. The state of health of electric is being discussed a lot. But an unmistakable signal comes from the request for assisted bankruptcy by the Swedish company Northvolt, a manufacturer of batteries for electric cars that has asked to be admitted to Chapter 11 in the United States. The bomb has therefore formally exploded in the US, but the worst consequences, presumably, will be in Europe. Since it rains on the wet, the CEO Peter Carlsson has also resigned. Since 2016 the start-up has raised something like 15 billion euros.In the bankruptcy request Northvolt declared 5.8 billion in debt. The Swedish company has said that it now needs around 1-1.2 billion dollars in new funds to carry out the restructuring and the hope is to complete the operation by March. #EV #battery #automotive #stellantis #greenenergy #future #eu #byd ##haval #china

The latest buzz about northvolt proves that it doesnt matter who starts first.  It matters who manages to build a sustainable value for the all stakeholders.   $10bn in financing, major Investors from EU and government.  So what really went wrong with the battery makers. Apart from the challenges with production, cancelled orders with majors like BMW. Financial challenges: Northvolt has been burning through $100 million per month. What led the downfall is the commitment of producing more than the fair share of resources.  https://lnkd.in/d74hEerf

Narratives crush rising tides. Stick to facts, you’ll do better. “Despite raising $13.8 billion in funding, the company generated only $128 million in revenue in 2023” “Reasons For Failure: Weak Market Demand: Despite the global EV push, demand for electric vehicles in Europe has softened, leaving automakers with excess inventory and scaled-back ambitions. Some automakers, delayed or downsized electrification projects, directly impacting Northvolt’s revenue pipeline. Operational Challenges: Scaling production is notoriously difficult, particularly in an industry as capital-intensive as battery manufacturing. Northvolt struggled to meet delivery timelines, losing a $2B contract with BMW in June after delays earlier in the year. Leadership Missteps: Northvolt tried to scale too quickly, taking on ambitious projects (like their green gigafactory) without ensuring its core operations were running smoothly. Former CEO Peter Carlsson admitted, “I should have probably pulled the brake earlier on some of the expansion paths in order to make sure that the core engine was moving according to plan.”. Financial Mismanagement: Northvolt's financial health deteriorated sharply, with net losses escalating from $285 million in 2022 to approximately $1.2 billion in 2023. #getoutside

As Northvolt edges closer to a critical $300 million rescue package, the stakes couldn't be higher for this Swedish battery manufacturer. With fierce competition from established Chinese companies and a slowdown in global battery demand, Northvolt's challenges illuminate the volatile landscape of electric vehicle supply chains. Key players like Volkswagen and Goldman Sachs are rallying support to stabilize production, but the path ahead is rocky. The recent job cuts and halted expansions signal deeper operational struggles that could undermine its ambitious plans. This situation serves as a wake-up call for the industry—survival hinges not only on securing funding but on navigating fierce competition, maintaining quality, and adapting swiftly to market demands. Will Northvolt rise to the challenge, or will it become a cautionary tale in the battery sector? Time will tell. What are your thoughts on the future of battery manufacturing in the face of such challenges?

Just a tiny hope. Northvolt project failure can be the massive failure of competence growth in EU. Outsourcing is easy&cheap. Reinshoring is a hard pain. The article mentions complicated chinese machineries: of course! they are 5-10 ahead with respect to EU in EV batteries. https://lnkd.in/d7EYUHki

Northvolt: files for Chapter 11 reorganisation in the US with debts of $5.8bn. This is a good if not perfect illustration of the challenges faced by both small and large start-ups in Europe with an onerous regulatory regime compared to the US, Middle East and Asia, and capital markets that are smaller and less efficient than the US. Interestingly, the "German and Canadian businesses, which are meant to build factories in each of those countries, would continue to operate as normal because they were financed separately, including via subsidies from the respective governments of almost $4bn". "Current and former Northvolt employees have previously blamed problems ranging from mismanagement and overspending to poor safety standards and heavy reliance on Chinese machinery for the group’s inability to expand production". "Its sub-Arctic factory had the capacity to make 16 gigawatt hours of batteries a year, enough to power about 270,000 cars, but last year produced less than 1 per cent of that, according to insiders". From a public markets perspective, it is clear that European companies in the same industry and quality as US companies have significantly lower valuations. Source: Financial Times #distresseddebt #credit

🤷♂️ Northvolt's Strategic Restructuring Amid Financial Challenges 🤷♀️ In a significant turn of events for the electric vehicle (EV) 🔋 battery sector, Northvolt, once hailed as Europe's frontrunner in battery production, is grappling with severe financial challenges. The company is reportedly exploring bankruptcy protection in the U.S. as it confronts a myriad of issues, including production setbacks and the loss of a key customer, all while facing headwinds in the automotive market that have led to a slowdown in battery electric vehicle sales across Europe. Since its founding in 2016, Northvolt has successfully secured approximately €10 billion in funding, positioning itself as a critical supplier for major automakers like BMW Group, Scania Group, and Volkswagen Group. However, recent reports indicate that Northvolt has had to make tough decisions, including significant workforce reductions of around 1,600 jobs to streamline operations and focus on its core manufacturing capabilities. Despite these challenges, Northvolt remains committed to its mission of revolutionising the lithium-ion battery industry. The company is concentrating its resources on accelerating production at its Northvolt Ett facility and is actively engaged in discussions to secure a financing package exceeding $300 million to bolster its financial stability. As Northvolt navigates this turbulent landscape, the broader implications for the EV market and the future of sustainable energy production remain to be seen. The company's ability to adapt and respond to these challenges will be crucial in determining its role in the rapidly evolving automotive industry. #Northvolt #ElectricVehicles #BatteryProduction #Sustainability #AutomotiveIndustry #Bankruptcy

🔋 Sweden's Northvolt AB, once touted as Europe's beacon for a homegrown EV battery industry, has filed for Chapter 11 bankruptcy protection in the U.S. The challenges faced by Northvolt mirror in stark relief the complexities and capital-intensive nature of building a resilient, competitive EV battery supply chain, especially in a rapidly changing global market. Northvolt's flagship factory in Skellefteå would not be affected and would be sustained with $145 million in collateral and $100 million in financing thanks to Scania, a Volkswagen subsidiary. German and Canadian facilities, however, remain on hold for now, as the desperate need for $900 million was what would stabilize the finances. My observationd from this, 1️⃣ Market Volatility and Cost Pressures: Aggressive competition, especially from established Asian manufacturers enjoying scale and cost advantages, is increasingly defining the EV battery market. Northvolt's financial difficulties make it clear why robust cost management and scalability in this industry are so important. 2️⃣ Strategic Importance of Partnerships: Northvolt's reliance on partnerships highlights the deepening importance of collaboration between OEMs and suppliers, but dependency on a few large customers could heighten risks, particularly as markets turn. 3️⃣ European Battery Ambitions: Northvolt symbolized Europe's efforts to create an independent supply chain for batteries. The financial struggles faced by the company raise several questions regarding how such ambitions could be supported in a sustainable way by governments, private investors, and industry players. This development underscores the immense challenges of building an independent EV supply chain in Europe. Northvolt's restructuring hopes now rest on strategic partnerships and investor support to navigate these turbulent times. What does this mean for Europe's green transition and its push for industrial independence in the EV space? #Sustainability #EV #GreenTransition #Northvolt #Chapter11