Northvolt, the Swedish battery manufacturer with plans to build a $ 7 billion factory in Quebec, said bankruptcy in Sweden.
The company said in a press release that the decision to declare bankruptcy had been taken after “an exhaustive effort to explore all the means available to guarantee a viable financial and operational future for the company”.
Northvolt has “experienced a series of composition challenges in recent months which have eroded its financial situation, in particular the increase in capital costs, geopolitical instability, subsequent disturbances of the supply chain and market demand changes,” the press release said.
The company claims that its North American operations are solvent.
Now, a trustee appointed by the court will determine the future of Northvolt companies and assets, including technology and production facilities, said the company.
It was not immediately clear how the bankruptcy of the company would affect the future of the massive electric vehicle battery plant of $ 7 billion in the Monthegia region on the southern shore of Montreal.
In 2023, the Quebec government promised $ 2.9 billion in funding to conclude the agreement with Steering wheel. Ottawa hired up to $ 1.34 billion to build the factory and $ 3 billion in other incentives.
So far, The Quebec government has invested $ 270 million in the project and the provincial pension investor, the Caisse de Dépôt et placement du Québec (CDPQ), also invested $ 200 million.
Quebec Minister of Economy, Christine Fréchette, said in an article on X that the government was disappointed with the situation, but said they were evaluating their options. She previously declared that the bankruptcy deposits of Northvolt will have had no impact on the Quebec Battery Factory.
“Our wish is that the controller will start to seek a buyer who will invest in taking over all the North American activities and relaunching the Montérégie project,” she wrote.
Despite the bankruptcy of the parent company of Northvolt in Sweden, Northvolt North America, a subsidiary of the Swedish company, said in a press release that it remains solvent and intended to honor its obligations and respect its financial commitments.
The Swedish government said it could intervene to support the company.
