Northvolt Sells Stake in Novo Energy Amid Bankruptcy Protections

Swedish battery maker Northvolt is selling its stake in Novo Energy to Volvo. Under bankruptcy protection, Northvolt seeks to cut costs and focus on battery production, while Volvo aims to continue Novo's plans with a new partner. Potential collaborations in North America are being explored.

In a strategic move amid financial constraints, Swedish electric-vehicle battery maker Northvolt has agreed to sell its stake in the joint battery venture Novo Energy to Volvo Cars. The deal marks a significant shift in Northvolt's strategy as it seeks to stabilize operations under U.S. bankruptcy protection.

Northvolt, which has been grappling with quality issues and production challenges, is refocusing its efforts on its primary business: battery cell production. This decision has prompted the company to divest from various projects, including those in Norway and Poland, while eyeing expansion in more stable markets like Canada and Germany.

Despite the divestiture, both companies remain optimistic. Volvo plans to seek a new partner to uphold Novo's timeline for battery production by 2026, while Northvolt is exploring new supply opportunities in North America, indicating continued interest in its technological capabilities.

(With inputs from agencies.)