Northvolt to Cut 1,600 Jobs Amid Struggles in EV Battery Market

Northvolt plans to lay off 1,600 employees in Sweden due to sluggish demand and competition from China in the electric vehicle battery market. The company also paused its expansion plans at the Northvolt Ett factory and stopped producing cathode active material. Northvolt aims to focus on its core business amidst these challenges.

Northvolt, Europe's leading hope in the electric vehicle battery market, announced plans to cut 1,600 jobs at its Swedish base, representing about a fifth of its global workforce. The company is struggling to cope with sluggish demand and competition from China.

On Monday, Northvolt also revealed it would suspend plans to expand its Northvolt Ett factory in Skelleftea, northern Sweden, and cease production of cathode active material, a key battery component. The decision marks a strategic shift from its original mission as an all-inclusive battery producer and recycler.

The company's growth has been slower than anticipated, with significant competition from China, which dominates 85% of global battery cell production. Northvolt has experienced order delays and even saw BMW pull a $2 billion order in June. Despite these setbacks, co-founder and CEO Peter Carlsson emphasized their determination to focus on core business operations to emerge stronger.

(With inputs from agencies.)