Volkswagen invests a further £438 million in sustainable battery production with Northvolt AB
The investment will help the German carmaker cope with the increasing demand for zero-emissions electric cars
Volkswagen Group are investing a further £438 million ($620 million/€500 million) in its Swedish battery partner Northvolt AB with a total volume of $2.75 billion (£1.94 billion/€2.26 billion). This will maintain the Group’s 20 percent stake in the company.
The funds will be used for the expansion of production, recycling, and research and development. Northvolt will expand the capacity of its Northvolt Ett gigafactory in Skellefteå located in Northern Sweden from 40GWh to 60GWh per year, to meet higher demand from customers.
Arno Antlitz, Group Board Member for Finance and IT, said: “With this investment, we are strengthening our strategic partnership with Northvolt as a supplier of sustainable battery cells which are produced using renewable energy and are comprehensively recyclable.”
Volkswagen had already invested about £777 million ($1095 million/€900 million) in Northvolt back in June 2019. This gave them about 20 percent of the shares in the company as well as a seat on the Board of Directors.
The production of Volkswagen premium cells will be concentrated at Skellefteå in cooperation with Northvolt. Production of these cells is due to start in 2023 and the annual capacity intended for Volkswagen is to be built up step-by-step to as much as 40GWh.
This shows that the German carmaker is expecting to sell far more electric cars in the coming years. This is not only good for them but contributes to a cleaner and more habitable world.
Thomas Schmall, Group Board Member for Technology and CEO of Volkswagen Group Components said: “Batteries are one of the key success factors in our unprecedented electric offensive. In the major area of green battery cells, we are assuming a pioneering role in Germany and Europe together.”
The second Volkswagen gigafactory is located in Salzgitter and will produce the standard cell for the volume segment from 2025. It is also expected to reach an annual production volume of up to 40GWh. Both gigafactories will be operated using electric power from renewable energy sources.
Volkswagen expects to commission six battery cell factories in Europe by 2030 together with its partners to safeguard the ramp-up of electric vehicle production. Other locations and partners for the next battery factories are currently being considered.