Volvo Group invests almost three billion euros in batteries

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With Northvolt, own battery cells are developed and produced from 2026

Volvo Group invests almost three billion euros in batteries-billion

Volvo is investing 30 billion Swedish kronor (around 2.93 billion euros) in the development and production of batteries. The partner is the Swedish battery manufacturer Northvolt. To this end, a joint development center and then a gigafactory will first be built.

The first is to open a joint research and development center in Gothenburg in 2022. It is close to Volvo’s existing development facilities, but also not too far from Northvolt Labs in Vasterås (around 70 kilometers northwest of Stockholm).

Volvo Group invests almost three billion euros in batteries-almost

The next step is to create a joint factory for the battery cells. It should have an annual capacity of up to 50 gigawatt hours (GWh). This makes the factory larger than the six 40 GWh gigafactories announced by the VW Group has. According to Volvo, 50 GWh is enough for around half a million electric cars. Construction of the factory will begin in 2023 and series production will begin in 2026. The location will be in Europe, but details have not yet been communicated.

"Our partnership with Northvolt ensures the supply of high-quality, sustainably produced batteries for the next generation of all-electric Volvo models." (Volvo boss Håkan Samuelsson)

The approximately 500,000 batteries are intended to cover Volvo Cars’ European needs. Volvo has apparently based an optimistic forecast: In 2020, Volvo sold around 288,000 vehicles in Europe, including probably only a tiny portion of electric cars. But in the next few years Volvo and Polestar want to launch a lot of electric cars. By the middle of the decade, every second vehicle sold is expected to be purely electric, and from 2030 only electric cars will be offered.

Volvo Group invests almost three billion euros in batteries-invests

Prismatic Northvolt cells in a Volvo electric car

Volvo and Northvolt set up a battery joint venture back in June announced. Even then, there was talk of a joint gigafactory and a research center. The amount of the investments was not yet announced at the time.

The integration of the development and manufacture of the batteries is important for Volvo, as these represent the largest single item in the cost of electric cars and have a decisive influence on the carbon footprint, according to the manufacturer.

More about Volvo and Polestar: Volvo Group invests almost three billion euros in batteries-almost Volvo and Polestar are reportedly planning small electric SUVs

Volvo Group invests almost three billion euros in batteries-volvo Polestar 3: New teaser picture shows the electric SUV in more detail

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