Northvolt, the Swedish battery manufacturer with plans to build a $ 7 billion factory in Quebec, declared bankruptcy in Sweden.
The company said in a press release that the decision to declare in bankruptcy was taken after “an exhaustive effort to explore all the means available to ensure a viable financial and operational future for the company.”
Northvolt has “experienced a series of challenges composed in recent months that eroded their financial position, including the increase in capital costs, geopolitical instability, subsequent interruptions of the supply chain and changes in market demand,” says the statement.
The company says that its American operations are solvent.
Now, an administrator appointed by the Court will determine the future of Northvolt business and assets, including technology and production facilities, the company said.
It was not clearly clear how the company’s bankruptcy would affect the future of the massive electric vehicle battery plant of $ 7 billion that Northvolt is being built in the Montérégie region on the southern coast of Montreal.
In 2023, the Quebec government promised $ 2.9 billion in financing to ensure agreement with Northvolt. Ottawa undertook up to $ 1.34 billion to build the plant and another $ 3 billion in other incentives.
Until now, The Quebec government has invested $ 270 million In the project and the provincial pension investor, the Caisse de dépôt et placement du québec (CDPQ), has also invested $ 200 million.
Quebec’s minister of economy, Christine Fréchette, said in an X position that the government was disappointed in the situation, but said they were evaluating their options. He previously said that Northvolt’s bankruptcy presentations will not have an impact on the Quebec battery plant.
“Our desire is that the controller begins to look for a buyer who will invest to take care of all the activities of North America and relaunch the Montérégie project,” he wrote.
Despite the bankruptcy of the Northvolt parent company in Sweden, Northvolt North America, a subsidiary of the Swedish company, said in a press release that remains solvent and intends to fulfill its obligations and fulfill its financial commitments.
The Swedish government has indicated that it could intervene to support the company.
