Volvo Car Group announced on Monday that they’ve entered into a joint venture with Swedish battery maker Northvolt for the development of sustainable batteries that will be installed in its electric vehicles. As a result of this deal, Northvolt will become Volvo’s exclusive battery cell production partner in Europe.
This deal will see Volvo and Northvolt partner establish a research and development center in Sweden to begin operations in 2022, as well as a gigafactory in Europe which will aim to produce up to 50 gigawatt-hours (GWh) per year in 2026. The gigafactory is expected to employ over 3,000 people.
Håkan Samuelsson, chief executive at Volvo Car Group, announced that this new joint venture with Northvolt will enable the Swedish car manufacturer to focus on strengthening their in-house developmental capabilities.
With carmakers shifting to electric vehicles, battery makers are scrambling to ramp up their own production levels in order to keep up with the surge in demand. Northvolt raised $2.75 billion in equity this year, which it plans to use in the expansion of the factory that it is currently building in northern Sweden. This is also the factory that Volvo plans to source its battery cells from starting 2024.
