Quebec Battery Plant in Doubt as Parent Company Declares Bankruptcy in Sweden
The fate of Northvolt North America’s electric vehicle battery plant project in Quebec’s Monterégie region is up in the air after its parent company in Sweden filed for bankruptcy on Wednesday.
The manufacturer’s Canadian subsidiary says Northvolt AB underwent an “exhaustive effort… to secure a viable financial and operational future” but was ultimately unsuccessful, The Canadian Press reports.
Interim chair Tom Johnston told the Financial Times,
It’s been a little bit of a roller coaster ride,
“It is a very sad day.”
The Times writes,
The Swedish start-up, which has backers including Volkswagen, Goldman Sachs, and BlackRock, said on Wednesday that it had been unable to secure financing to continue and that a court-appointed trustee would sell its assets,
“It is an ignominious end for a company that attracted US$15 billion of corporate and government investment to develop technology for electric vehicles where Europe is playing catch-up to Asian countries such as China, Japan, and South Korea.”
Northvolt North America says it remains solvent and intends to honour its obligations, including toward its employees, CP says.
Its Quebec battery plant project, dubbed Northvolt Six and slated for construction about 25 kilometres east of Montreal, amounts to a C$7-billion undertaking to churn out battery cells and cathode active material for electric vehicles.
Spokeswoman Emmanuelle Rouillard-Moreau would not confirm when asked if construction on the project will move ahead as part of Northvolt North America’s commitment to honour obligations.
She says,
Any decisions regarding the subsidiary will be made by the court-appointed trustee of Northvolt AB, together with the group’s lenders, at the appropriate time.
The federal and Quebec governments are hoping a buyer can be found for the company’s North American operations.
Quebec Economy and Energy Minister Christine Fréchette said in a social media post that
The government wants the trustee to start looking for a buyer who will invest to take over all activities in North America to relaunch the project.
She said Quebec will get in touch with the trustee,
Rapidly.
In Quebec, particularly in Bécancour, near Trois-Rivières, Fréchette said,
We are obviously disappointed by the situation. On the other hand, we must remember that several other projects in the battery sector are continuing
The two orders of government have pledged to invest $2.4 billion in the project. According to news reports, Ottawa has not yet released its contribution.
The Legault government has poured $270 million into the Swedish parent company, and Fréchette confirmed this sum “has lost its value.” The Caisse de dépôt et placement du Québec invested $200 million in the company, and the Ontario Municipal Employees Retirement System (OMERS) declared a US$325-million loss on its own stake in Northvolt AB at the end of last month.
Quebec granted Northvolt a further $240 million for the purchase of land in Montérégie. This sum is secured by collateral on the land and assets of Northvolt’s North America subsidiary, Fréchette said.
CBC reports,
The mayor of Saint-Basile-le-Grand, where work on the future battery plant was already under way, remained hopeful but unconvinced the project would be completed,
Yves Lessard said in French,
You have to be realistic,
“From the moment Northvolt declared bankruptcy in Sweden, things have become fragile.”
On Thursday, Northvolt’s Johnstone called on EU policymakers to “face up to the costs” of developing a domestic battery-making industry to reduce the continent’s dependence on suppliers from Asia, the Financial Times writes.
He said,
There’s going to be a huge amount of money to invest, there’s going to be some pain to go through,
“There’s a cost to pay for it, but there can be a bigger cost to pay for not doing it.”
Major segments of this story were first published by The Canadian Press on March 12, 2025
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Quebec Battery Plant in Doubt as Parent Company Declares Bankruptcy in Sweden, source
