Volkswagen and BMW invest in Europe's largest lithium-ion battery factory

Volkswagen and BMW invest in Europe’s largest lithium-ion battery factory. Europe’s largest lithium-ion battery factory has raised around 1,000 million dollars from the two major automotive groups. Northvolt is the company behind the factory.

This investment, estimated at around 1,000 million euros, aims to establish the lithium-ion battery plant in Skellefteå, Sweden. In addition, a second gigafactory is also planned to be built in Lower Saxony, Germany.

Peter Carlsson, co-founder and CEO of Northvolt, has stated that “today is not only a major milestone for Northvolt, it also marks a key moment for Europe that clearly shows we are ready to compete in the next wave of electrification, and that we will do so using battery cells with the best possible CO2 footprint”.

Construction of the Swedish plant will begin next August, before large-scale battery production starts in 2021. The factory will initially have 16 GWh of lithium-ion battery cell manufacturing capacity. To put that into perspective, Gigafactory 1 of Tesla had a capacity of approximately 20 GWh throughout 2018 and will grow in the coming years. The Northvolt plant will be expanded to at least 32 GWh.

Volkswagen and BMW invest in Europe’s largest lithium-ion battery factory

Dr. Stefan Sommer, member of the Board of Management of Volkswagen and responsible for procurement, has stated that “Volkswagen is laying the groundwork at all levels for the successful implementation of its electrification strategy. With Northvolt, we have found a European partner whose know-how and optimised, CO2-conscious sustainable cell production processes will allow us to advance cell production here in Germany. The prerequisite for this is, of course, the creation of the political framework.”

The aforementioned German gigafactory will be set up through a 50/50 joint venture between Volkswagen and Northvolt. This plant will begin manufacturing battery cells for the first brand from late 2023 or early 2024.

It is important to highlight that Northvolt is a European supplier of sustainable, high-quality battery cells and systems. The company is currently setting up pilot battery cell production and a battery cell production facility with an initial capacity of 16 GWh in Sweden. Founded in 2016 to enable Europe’s transition to a decarbonised future, the company has progressed rapidly in its mission to deliver the greenest lithium-ion battery in the world with a minimal CO_{§h32Teslah33§} footprint and the highest recycling ambitions. In addition to Volkswagen, Northvolt’s industrial partners and customers include Scania, ABB, BMW, Siemens, Vattenfall and Vestas.