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  • August 2021 (Revised February 2022)
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Northvolt: Making the World's Greenest Battery

By: Jurgen R. Weiss and Emilie Billaud
  • Format:Print
  • | Language:English
  • | Pages:33
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Abstract

In 2021, the demand for lithium-ion batteries increased rapidly, particularly for electric vehicles. Anxious not to be reliant on Asian players, Europe was keen on developing its own home-grown capacity to control the value chain, maintain employment in Europe, and get a share of the profits. The unpredictability of the coronavirus pandemic, which had exposed vulnerabilities in global supply chains, had also put pressure on European countries to move quickly to keep Europe's automakers competitive. Europe had a new champion in Sweden’s Northvolt, which was headed by a former Tesla executive. Since its inception in 2016, Northvolt had raised $6.5 billion in debt and equity and built a team of 2,000 people in three countries. It had begun construction of a first “Gigafactory” in Northern Sweden that would manufacture lithium-ion batteries on an unprecedented scale. The company also stood out by its ambition to build the world's greenest car battery—a concept that encompassed minimal carbon footprint, ethical sourcing of raw materials, and a robust ecosystem for recycling. Even though Northvolt had secured offtake agreements amounting to $27 billion through 2030, the construction of its first “Gigafactory” had yet to be completed. Would the bet on making the most sustainable battery pay off? And would the company be able to execute the multi-billion-dollar construction projects to build the factories and then operate them as planned to meet the quickly rising demand for the batteries it had committed to delivering?

Keywords

Electric Vehicles; Lithium-ion Batteries; Business Ventures; Energy; Green Technology; Technological Innovation; Growth and Development Strategy; Competitive Advantage; Transportation; Supply Chain; Globalized Markets and Industries; Goals and Objectives; Factories, Labs, and Plants; Battery Industry; Energy Industry; Green Technology Industry; Transportation Industry; Europe; Sweden; Germany; Poland

Citation

Weiss, Jurgen R., and Emilie Billaud. "Northvolt: Making the World's Greenest Battery." Harvard Business School Case 722-004, August 2021. (Revised February 2022.)
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Related Work

    • August 2021 (Revised February 2022)
    • Faculty Research

    Northvolt: Making the World's Greenest Battery

    By: Jurgen R. Weiss and Emilie Billaud
    • May 2022
    • Faculty Research

    Northvolt: Making the World's Most Sustainable Battery

    By: Jurgen Weiss
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  • Northvolt: Making the World's Greenest Battery By: Jurgen R. Weiss and Emilie Billaud
  • Northvolt: Making the World's Most Sustainable Battery By: Jurgen Weiss
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