Volvo and Northvolt will build a battery factory to produce up to 50 gigawatt-hours of cells a year – enough to supply about half a million cars.
Volvo Cars and battery maker Northvolt will build their joint battery plant in Gothenburg, western Sweden, the two companies said.
The plant will employ up to 3,000 people and produce up to 50 gigawatt-hours of cells a year – enough to supply about half a million cars.
It will produce battery cells specially developed for use in next-generation fully-fledged Volvo and Polestar cars, Swedish-based companies said in separate statements.
Companies expect the new plant to begin operations in 2025.
Volvo takes over
Volvo becomes a surprise leader in Europe’s race to produce more electric vehicles.
The carmaker, which is controlled by Zhejiang Geely Holding Group of China, plans to sell 50% pure electric cars by the middle of this decade and fully electric cars only by 2030.
“Our partnership with Northvolt battery cells is the key to our strategic electrification ambitions,” Volvo Cars CEO Hakan Samuelsson said in a statement.
The companies have chosen former Tesla director Adrian Clarke to lead their joint production company.
Last year, Volvo and Northvolt announced plans for a joint venture to develop batteries for electric cars, including the establishment of a gig production plant and a research and development center, with a total investment of around SEK 30 billion (3, $ 3 billion). The center, also located in Gothenburg, will start operating this year.
Gigafabrica Northvolt in the Swedish city of Skelleftea assembled its first battery cell at the end of December, becoming the first European company to design and manufacture a battery in Europe.
Northvolt said in December it had won contracts worth more than $ 30 billion from electric car manufacturers, including BMW and Volkswagen.