German car giant, the Volkswagen Group, is set to join forces with Swedish batter cell producer Northvolt AB with a €900m (US$1bn) investment, it has been announced.
The large sum of money will go toward advancing the Volkswagen Group’s battery cell production, which are continuing to increase, as well as acquiring 20% of shares in Nothvolt, and also establishing a new battery factory later in the year.
“Volkswagen is laying the groundwork at all levels for the successful implementation of its electrification strategy. With Northvolt, we have now also found a European partner whose know-how and sustainable, CO2-optimized battery cell production processes will enable us to advance cell production here in Germany. The prerequisite for this is, of course, the creation of the necessary economic framework,” said Dr Stefan Sommer, member of the Volkswagen AG board of management responsible for procurement.
Northvolt is a supplier of sustainable battery cells and systems. The company is currently setting up pilot production of battery cells and a battery cell production facility with an initial capacity of 16GWh in Sweden. Founded in 2016, to enable the European transition to a decarbonized future, the company has made swift progress on its mission to deliver the world’s greenest lithium-ion battery with a minimal CO2 footprint and the highest ambitions for recycling. Apart from Volkswagen AG, Northvolt’s industrial partners and customers include Scania, ABB, BMW, Siemens, Vattenfall and Vestas.
The 50:50 joint venture with Volkswagen plans for the build of a 16GWh battery cell factory in Lower Saxony to begin by 2020 and start producing battery cells by 2023.