October 13, 2024 – According to Reuters, on Friday local time, three informed sources revealed that Northvolt, the Swedish electric vehicle battery manufacturer, is currently engaged in negotiations with investors and lending institutions to raise approximately 200 million euros in short-term funding, aiming to maintain the company’s financial stability.
This week, Northvolt initiated financing talks and still intends to gather additional funds for its long-term growth. On Friday, the company reiterated its September 24th statement, highlighting significant progress in fundraising efforts, albeit without providing further specifics.
Once seen as a “rising star” of the European electric vehicle battery industry, Northvolt now finds itself in a tight financial spot.
Another source indicated uncertainty regarding how long this short-term financing will sustain the company, noting that it’s insufficient for the long haul. On Thursday evening, Northvolt announced a tax payment of 28.7 million Swedish kronor, due the following Monday. Previously, rumors surfaced about Northvolt’s plans to sell excess battery materials to generate funds.
Last month, Northvolt announced a reorganization and layoffs due to production hindrances, sluggish demand, and competitive pressure from China.
Despite being viewed as a pacesetter in the battery industry, Northvolt continues to grapple with challenges in scaling up production and enhancing quality. These issues led BMW to rescind a significant order, and caused delays in Traton and Scania’s electric vehicle initiatives.
Founded in 2016, Northvolt is a Stockholm-based Swedish battery manufacturer, backed by prominent partners such as Volkswagen Group, Goldman Sachs, and Siemens. Financial results for fiscal year 2023, released in July, showed an increase in revenue to 128millionbutawidenedlossfrom284 million to $1.167 billion.