The Volkswagen Group has invested in the Northvolt battery manufacturer, now in bankruptcy. Like other manufacturers, the German group will lose feathers.
Northvolt dreamed of the leader in the production of the old continent batteries. The company had to be an example for the development of the battery sector in Europe. Unfortunately, too high ambitions and mistakes in the field of management led the Swedish company mainly to bankruptcy, which caused him to those who believed in the project, including several car manufacturers such as Volvo or Volkswagen.
The Volkswagen Group is the largest investor Northvolt with 20 % shares. Since 2019 he has injected EUR 1.4 billion in the company, as emphasized by the German Media Auto Auto. In addition to losing investment, Volkswagen had to change his plans for the supply of some models.
Several models had to be equipped with Northvolt batteries
In addition to being an investor, Volkswagen was also a Northvolt customer for its high -end models and Scania trucks. In 2021, the German group placed $ 14 billion. The German group therefore had to review its premium battery supply, because it is unlikely that Northvolt is able to honor orders, at least not in the expected volumes.
Initially, Audi counted on Northvolt for A6 e-tron batteries, which must arrive in retailers in the coming weeks. The brand probably found another supplier to satisfy cell production of this key novelty for Audi.
According to Oliver Blut, in 2022, as the head of Porsche, the luxury brand also planned to use Northvolt cells exclusively for its future electric 718, which was to arrive in 2025. It did not rule out that the disappointment with the Swedish battery manufacturer leads to originally planning.
Fortunately for Volkswagen, the failure of Northvolt as a battery supplier is not an insurmountable problem for the gross range of the group.
Powerco for high -volume models
Volkswagen focuses mainly on Powerco, its division of batteries, especially its electric range. These cells will be used in 80 % of the brand models, including the future ID.2.
While the Salzgitter factory was to be listed in cooperation with Northvolt, according to the announcements made in 2019, it is eventually Powerco who will start production there in 2025. In Spain and Canada, other PowerCO factories are planned, but projects are required to develop according to demand in electric vehicles.
Initial loss of investment
If the Volkswagen group does not have a priori problem that will replace Northvolt cells with another supplier. Massive investments made in Northvolt to help its growth (and maintaining 20 % of Volkswagen shares during consecutive fundraising) are irreplaceable. However, Volkswagen has already reduced the wing by depreciating his participation, as well as other investors, when they saw the disappointment accumulate.
It is probably invested much more than € 1 billion, which could even end up in zero that was in March. Disastrophic investment for Volkswagen, which would rather start 2025 under a better auspices.