Battery giant Northvolt to lay off 1,600 people in Sweden: Will this affect Quebec’s future plant?

Swedish battery maker Northvolt will lay off 1,600 employees in Sweden, a fifth of its workforce, as it seeks to “focus all energy and investment on (its) core business” amid financial difficulties.

The company announced plans on Monday to cut 1,000 jobs in Skellefteå, 400 in Västerås and 200 in Stockholm. The layoffs will be negotiated with the relevant unions.

In a statement, Northvolt President and CEO Peter Carlsson said that “while the overall momentum for electrification remains strong,” the company must ensure that it takes “the right steps at the right time in response to the headwinds in the automotive market and the broader industrial climate.”

“The decisions announced today are both difficult and painful,” he acknowledged.

“However, these decisions are necessary to adapt to current realities and enable Northvolt’s long-term success. We are determined to overcome the challenges we face and emerge stronger and lighter while continuing our work to contribute to a more sustainable society,” he said.

As part of the restructuring, the company will suspend the expansion of its flagship Northvolt Ett plant in Skellefteå. It will also slow down programs and expansion at its laboratories in Västerås.

This reduction in activities in Sweden will result in fewer administrative needs, which explains the job cuts in Stockholm, where the company is headquartered.

“Today marks one of the most challenging periods in our company’s journey,” Northvolt’s Chief People Officer Daniela Maniaci said in the statement.

Two weeks ago, Northvolt announced that it was abandoning its cathode manufacturing project in Borlänge and putting cathode-related activities at its parent plant in Skellefteå on hold.

We’re working with @Northvolt to make the world’s cleanest electric vehicle batteries right here in Quebec. Their new facility will create good jobs, fight climate change, and grow our economy for generations to come. Get the details: https://t.co/n4O5sauIS7 pic.twitter.com/PR13j1qlhf

— Justin Trudeau (@JustinTrudeau) September 28, 2023

However, it assured that it was maintaining its commitments to build three other major projects, including a cell plant on Montreal’s South Shore.

Monday’s update did not provide any new information regarding the Quebec plant.

Northvolt’s financial difficulties led to debates in the National Assembly last week over the energy blocks reserved for its future plant, which is to be built in Saint-Basile-le-Grand and McMasterville, in Montérégie.

The form and schedule of the $7 billion project, in which Quebec and Ottawa have committed to investing $2.4 billion, may have to be reviewed due to Northvolt’s new strategic orientations, which are to prioritize the manufacturing of battery cells over cathode-related activities.

Initially, the Quebec plant was to have three components: the manufacturing of cells, cathodes and battery recycling. More information on the future of the project is expected during the fall.

–This report by La Presse Canadienne was translated by CityNews