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Volvo Halts NOVO Energy Gigafactory, Cuts Remaining 75 Jobs After Partner Search Fails

Cost pressure is stalling European plans to build domestic battery capacity.

Volvo Cars says it still wants to make batteries eventually, but can't say when or how

Overview

  • NOVO Energy said operations, including construction of the Gothenburg cell plant, are paused until a new technology partner is secured, with no timeline or structure for a restart.
  • NOVO was founded in 2021 as a VolvoNorthvolt venture; Volvo assumed full control after Northvolt’s bankruptcy in March 2025.
  • The Gothenburg facility, envisioned at up to 50 GWh to supply Volvo and Polestar, now sits idle without manufacturing equipment installed.
  • Chair Alexander Petrofski said talks with multiple battery makers continue, citing carrying costs as the reason for the pause and stressing the need for EU credit guarantees and clear support.
  • The European Commission announced €1.5 billion in interest‑free loans in late 2025, while other Swedish battery assets face divergent paths, including Lyten’s bid to revive Northvolt’s Skellefteå site and delays at Volvo Group’s Mariestad project.