Volvo Cars says it will not pay Northvolt for battery joint venture stake

GOTHENBURG: Volvo Cars will not pay Northvolt any money for its 50% stake in their Novo Energy battery venture, which it had agreed to acquire, the automaker's quarterly report said on Thursday.

The automaker last week agreed with Northvolt to take over its stake in the venture, which included a planned Gothenburg battery cell factory, without disclosing the amount involved.

Northvolt, once considered Europe's best hope for a battery champion, filed for US Chapter 11 bankruptcy protection last November.

"The purchase consideration rounds to 0 m SEK. The purchase amount has been negotiated as part of a larger settlement with Northvolt, taking many factors into account," a Volvo spokesman said.

A Northvolt spokesman said that the company and its advisers "determined that this agreement is in the company’s best interests".

The Novo battery factory was announced in 2021 and meant to start production in 2026, but Volvo has said a new investor would be needed for that to happen and that it was exploring other options for the building.

Volvo Cars CEO Jim Rowan told Reuters on Thursday that it had wind and waterproofed the building to protect it while it decides what action to take.

Construction had almost finished when Northvolt's problems arose last year.

"We'll decide exactly how we use that building in the future, whether we sell it or whether we use it for a different purpose, we'll figure that out in the months ahead," Rowan said.