By GB News (World News) | Created at 2024-11-25 10:09:30 | Updated at 2024-11-25 12:19:19
2 hours ago
The EU’s net zero crusade has been dealt a major blow as Swedish battery manufacturer Northvolt filed for bankruptcy protection in America just ten months after receiving a €1billion loan from the European Investment Bank.
Northvolt was widely seen as Europe’s answer to Asian dominance of the battery market, attracting eye watering loans from the green-obsessed EU.
In January, the EU commission said: “The European Investment Bank (EIB) will finance Northvolt's gigafactory in Northern Sweden, with a total lending package to slightly over $1.038 billion (€942.6 million).
“The deal is the largest green loan raised in Europe to date and will facilitate the creation of a fully integrated circular battery production facility that has not previously existed outside Asia.”
But, as GB News and Facts4EU can reveal, the company now has debts of $5.8million thanks to a slowdown in electric car sales, overambitious plans to build three factories at once and the loss of major customers like BMW.
The company, which employs about 6,600 staff across seven countries, said: “Northvolt’s liquidity picture has become dire,” in a bankruptcy court in Houston, Texas.
The bankruptcy means Brexit has saved the British taxpayer millions in EU payments which would have been invested in Northvolt.
In a statement that will leave rejoiners red faced, the EU Commission Executive Vice-President Maroš Šefčovič said in January: “We mean business when it comes to Europe's battery industry.
Northvolt's factory in northern Sweden
Getty
Before the election, Labour blasted the Conservative’s watering down of measures designed to phase out petrol and diesel cars by 2030.
Starmer’s party pledged to ban the sale of these cars by 2030 while accelerating the roll out of electric vehicles.
Little has been announced since, but leaks have emerged that the government is considering allowing hybrid cars to be sold until 2035.
Northvolt’s Swedish CEO Peter Carlsson, who has led Northvolt since 2016, will step aside with immediate effect while the company restructures.
Carlsson believes Northvolt needs to raise between $1billion (£800million) and $1.2billion in order to restore the business.
Northvolt expects to complete restructuring by the first quarter of 2025.
Meanwhile, industry leaders like China’s CATL, Japan’s Panasonic and South Korea’s LG continue to control 85 per cent of the battery market, according to International Energy Agency data.
