Scania has increased its investment in Swedish lithium-ion battery developer Northvolt after taking part in a US$600 million equity raise.
It joined current Northvolt shareholders Goldman Sachs Merchant Banking Division, IMAS Foundation and Volkswagen AG in the private placement.
Scania says it’s a “proportional increase” to the 10 million euro (US$11.7m) investment it first made in 2018.
Private investors Daniel Ek and Cristina Stenbeck also participated in the equity raise.
Ek is a Swedish billionaire entrepreneur known for being the co-founder and CEO of music streaming service Spotify.
Stenbeck is a Swedish American business woman and entrepreneur and principal owner and former executive chairman of Investment AB Kinnevik, one of the largest family-controlled companies in Sweden
Northvolt will use the investment to help expand its production and recycling capacity as well as R&D activities to support the target of establishing 150GWh of manufacturing capacity in Europe by 2030.
This will be achieved through a planned giga-scale lithium-ion battery recycling facility next to the Northvolt Ett Gigafactory under construction in Skellefteå, Sweden.
The facility will become the largest in the world with an initial capacity of 4GWh, and the only large-scale facility in Europe capable of recycling lithium in addition to cobalt, nickel, manganese and other metals.
The Ett Gigafactory has also received US$350m in financing from the European Investment Bank and is expected to be in production by 2021.
Meanwhile, permitting is also underway for Northvolt Zwei in Salzgitter, Germany, which is scheduled to commence operations in 2024 with an initial output of 16GWh.
These initiatives will facilitate Northvolt’s target of a 25% market share in Europe by 2030 with 50% of its raw material coming from recycled batteries.
Peter Carlsson
Northvolt co-founder and chief executive Peter Carlsson says securing investors such as Scania is an important first step.
“Scania has been a crucial partner for Northvolt already from the start.
“We look forward to continuing to strengthen this partnership over the coming years as we ramp up our production of battery cells to support Scania’s new electrified fleet of trucks.
“We are in the middle of a race to establish manufacturing capacity in Europe, and I believe the companies that are best at attracting talent and capital, while scaling their blueprints the fastest, will be the most successful.
“With these world-class partners behind us, we have created a solid foundation to go on and execute our plans to enable large-scale manufacturing of green batteries in Europe,” Carlsson says.
In September this year, Scania launched its first fully electric truck range which is now available in the European market with the L-and P-series cab.
The company says vehicle electrification “is rapidly advancing” and for heavy trucks and buses, continued development of charging infrastructure and battery cells is needed.
The partnership with Northvolt is “one of several strategic initiatives” as the company moves towards more sustainable transport solutions, it says.
Scania head of purchasing Anders Williamsson says sustainable sourcing and production of batteries is a current challenge in the whole automotive industry.
“Northvolt was founded with the mission to build the world’s greenest battery, with a minimal carbon footprint and the highest ambitions for recycling.
“That is why we think that Northvolt’s mission very much matches Scania’s ambition and purpose to drive the shift towards a sustainable transport system,” Williamsson says.
Northvolt has to date raised more than $3b in equity and debt to support the development of its two lithium ion battery gigafactories and investments in R&D, industrialisation and recycling.
Join the conversation