Gothenburg to host major new car battery factory

Construction will be fast-tracked, and 3000 new jobs will be added to the local labour market

Earlier today, Volvo and Northvolt AB announced that they had chosen Gothenburg as the site for the construction of a new car battery plant. It will not take long to see the working facility, either. Construction will start next year and, in 2025, it will commence operations. The social benefit for the Swedish city is that the venture will create 3,000 new jobs there.

The factory will also boost Volvo’s electrification strategy. The company aims to produce and sell only fully electric cars by 2030.

A move to transform Sweden’s automotive sector

In output terms, it was reported that the plant will have the potential to manufacture cells with a combined total annual capacity of up to 50 gigawatt hours (GWh). This is the equivalent of supplying half a million cars with batteries per year.

The Swedish location of the plant, which will be built in Torslanda, a suburb of the Gothenburg metropolis, offers benefits in terms of a direct route into Volvo Cars’ largest car plant also located in that area. Likewise, it will provide access to infrastructure, a strong pipeline of renewable energy supply and relevant job competencies, as well as its proximity to both Volvo Cars’ and Northvolt’s R&D units.

Northvolt, which at the very end of last year started operating Europe’s largest battery gigafactory in the north of Sweden, has stated its ambitions to become the “leading global supplier of sustainable batteries”.

In line with the sustainability theme, the plant will be powered by fossil-free energy with a focus on driving renewable energy capacity in the region. It will also integrate engineering solutions that prioritize circularity and resource efficiency.

Shortening dramatically the supply chain for car batteries will actually also lead to a concurrent reduction in the carbon footprint of car production. That is because battery manufacturing has been sourced to manufacturers in Asia which creates a long supply chain.

An R&D centre dedicated to developing tailor-made and more efficient batteries is also part of the deal between the two companies. The centre will start working even earlier, at some point this year, and will additionally provide several hundred jobs.