Northvolt Cuts Battery Factory Price in Bid to Lure Investors

Swedish startup Northvolt AB tells Reuters it has “significantly” lowered the estimated cost of the electric-car battery factory it hopes to build.

The original plan called for opening a €4 billion megafactory in 2023 with annual capacity to make cells representing 32 gigawatt-hours of energy.

Paolo Cerruti, Northvolt’s chief operating officer, didn’t reveal the company’s new cost target. But he says the company has found ways to lower raw materials costs, improve the plant’s productivity and reduce the amount of energy required by the production process.

The Stockholm-based startup attracted more than €100 million ($116 million) in initial funding to build a pilot line, but the process took longer than expected. Investment advisors cited by Reuters caution that attracting institutional funding may be difficult because the project is so risky. They cite Northvolt’s inexperience and strong competition from established Asian batterymakers.

Northvolt says its project is driven in part by a desire to provide Europe with a local batterymaker precisely to avoid ceding the market to other producers. The European Investment Bank, a first-round investor, tells Reuters it is ready to further support “this kind of innovation.”