Northvolt was founded by two former Tesla executives.
Bloomberg News | March 25, 2024 |
(Image: Northvolt)
Northvolt AB is starting construction of a €5 billion ($5.4 billion) battery plant in northern Germany to supply electric cars, capping an intense lobbying effort under newly relaxed European Union state aid rules.
The project will receive just over €900 million in handouts and guarantees from Germany, which helped prevent the project being lured to the US. Chancellor Olaf Scholz said the factory near the town of Heide will help support the country’s future as a manufacturing base.
“The production of good cars beyond the combustion engine continues to form the backbone of our industrial sector,” Scholz said Monday according to a statement during an opening ceremony. “For that we need battery cells made in Germany, made in Europe.”
The EU last year eased its rules on nations providing subsidies to better compete with the US, where generous tax relief and aid for climate technologies is pulling in investments. Northvolt, Europe’s only major home-grown EV battery maker with customers including Volkswagen AG and BMW AG, is also developing a site in Canada.
Northvolt’s Heide plant, running on wind power, will employ roughly 3,000 people and start operating in 2026. The site is targeting an annual capacity of 60 gigawatt-hours — which would make it Germany’s biggest — and enough to power roughly 1 million electric vehicles. Initial estimates on the cost of building Heide were pegged at €4.5 billion.
(By Rafaela Lindeberg and Michael Nienaber)
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