Following initial steps taken as part of its strategic review, and in response to a challenging macroeconomic climate, Northvolt adjusts ambitions to focus on ramping up the first 16 GWh production capacity at Northvolt Ett.
Following initial steps taken as part of its strategic review, Northvolt today outlines a revised scope of operations in Sweden to ensure that its resources are focused on accelerating production in large-scale cell manufacturing at Northvolt Ett. These measures are expected to result in the redundancy of approximately 1,600 Northvolt employees, split across Skellefteå (1,000 positions), Västerås (400 positions) and Stockholm (200 positions). All redundancies are subject to ongoing union negotiations.
In adjusting its near-term ambitions and focusing on the ramp-up of the first 16 GWh phase of Northvolt Ett, Northvolt positions itself to prioritize commitments to its current automotive customers. This priority is further being supported by a recently introduced acceleration program geared to further increase levels of production. The program is already demonstrating results and contributed to Northvolt Ett cell production increasing threefold since the beginning of this year.
Peter Carlsson, CEO and Co-Founder of Northvolt, commented: “While overall momentum for electrification remains strong, we need to make sure that we take the right actions at the right time in response to headwinds in the automotive market, and wider industrial climate. We now need to focus all energy and investments into our core business. Success in the ramp-up of production at Northvolt Ett is critical for delivering to our customers and enabling sustainable business operations. Recent production records at Northvolt Ett show that we are on the right path, but the decisions we’re taking today, however tough, are required for Northvolt’s future.”
Rescoped operations
In Skellefteå, Sweden, the development of Northvolt Ett expansion project will be suspended. The construction project was intended to provide an additional 30 GWh of annual cell manufacturing capacity. The decision follows the announcement earlier this month to place the Northvolt Ett cathode active material facility into care and maintenance.
In Västerås, Sweden, programs and expansion will be slowed at Northvolt Labs. The fundamental platforms hosted at Northvolt Labs will be maintained, enabling Northvolt Labs to retain its position as Europe’s leading campus for battery innovation and product development.
As it reduces the scope of its operations and programs in Sweden, Northvolt will also reduce the size of its corporate support functions, which today are largely located in Stockholm.
The rescoping of operations is critical to ensure a sustainable operation and cost base. In order to achieve this a workforce reduction of approximately 20% at a global level, and 25% in Sweden is required. The company is currently engaged with its union representatives surrounding all relevant processes and the path forward.
Appropriate measures to support impacted employees
Acknowledging the impacts that the resizing of Northvolt’s workforce will have, especially at Northvolt Ett and for the city of Skellefteå in northern Sweden, Northvolt has engaged its partners and stakeholders to support in efforts to mitigate impacts to the greatest extent possible.
Northvolt’s internal resources have been mobilized to support impacted employees in several areas, including the search for new employment and assistance in matters relating to relocation. Further to this, Northvolt is establishing a taskforce together with external partners to provide additional support to employees on work visas, and their families.
Daniela Maniaci, Chief People Officer, commented: “Today marks one of the most challenging times in our company’s journey, as we face the difficult reality of reducing our workforce. Our priority is to offer as much support as possible during this time to all our employees, especially those impacted by redundancy. In supporting employees who will leave the company, we are committed to handling the process with compassion and care, and ensuring everyone receives guidance needed for their next steps.”
Stronger determination than ever
While narrowing its immediate focus, Northvolt is more than ever committed to its founding intention of establishing a homegrown, European industrial base for battery production. The decisions outlined today are designed to support this by establishing a stronger focus on scaling up battery cell production and, thereby, a foundation for future growth.
Peter Carlsson concluded: “The decisions announced today are both challenging and painful. I and all my colleagues at Northvolt will do everything we can to support the colleagues who will eventually leave the company. The decisions are, however, necessary to adjust for current realities and enable the long-term success of Northvolt. We are determined to overcome the challenges we face, and to emerge stronger and leaner as we continue forward in our work to contribute to a more sustainable society.”
Source: Northvolt outlines revised scope of operations in Sweden
