Stockholm, Sweden

In an internal memo seen by Reuters, Swedish battery maker Northvolt is negotiating the sale of its profitable industrial battery business, Northvolt Systems Industrial, by the end of the year as central to a strategy to reduce financial strain. No deal has been finalised, but talks are underway with a major industrial company.  

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The divestment is part of Northvolt's pivot to become a battery cell company only as it filed for U.S. Chapter 11 bankruptcy protection on November 21. The restructuring was driven primarily by the company's failure to secure up to USD 1.2 billion in long term funding, the company said.  

Industrial Battery Business on the Block

The company, Northvolt Systems Industrial, builds battery packs for heavy machinery, such as forklifts and drill rigs, and customer include Swedish mining equipment maker Epiroc and Finnish engineering firm Konecranes. One of the company's few profitable ventures, it is headquartered in Poland and operates through its Northvolt Dwa factory.  

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"We’re focused on a positive outcome and are optimistic about the sale,” said a Northvolt spokesperson. But Epiroc and Konecranes are still cautious. Epiroc is keeping a close watch on what is happening to maintain the quality and delivery reliability, Konecranes affirmed it isn't in the discussions to acquire the business.  

Strategic Shift and Layoffs

As well as the planned sale, Northvolt is also shutting down its energy storage business, another Northvolt Systems division, because it has been unable to secure investors for that business. The closure will see about 130 jobs go in Poland.  

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It is a huge shift in energy storage, a market growing as a result of high energy prices and demand for power storage solutions. Failing to enter this segment could cost Northvolt a lucrative opportunity, they warn. Andy Palmer, founder of Palmer Automotive, said that with Nordvolt "metaphorically stretching itself too wide, it could be wishing it had never entered this market."  

Impact on Northvolt’s Broader Plans

If the industrial battery sale proceeds, Northvolt’s operations will be scaled back to its flagship factory in Skellefteå, Sweden, and its R&D facility in Västerås. Meanwhile, plans for new factories in Germany and Canada face delays, raising further questions about Northvolt’s ability to fulfill its ambition of becoming Europe’s EV battery champion.