RICARDO HAUSMANN
Investing in electric-vehicle battery production may seem like a sure thing. And at first glance, Northvolt – the Swedish EV battery developer and manufacturer that filed for bankruptcy protection in November – appeared to have all the advantages and capabilities needed to succeed.
For starters, the market fundamentals are undeniably strong. EV production is projected to grow exponentially: Tesla is trading at more than 100 times its earnings, whereas Toyota – the world’s largest manufacturer of gasoline-powered cars – has a price-to-earnings ratio of ten. Supporting these optimistic market projections, Northvolt had already secured $50 billion in sales orders, and raising capital proved remarkably easy. Northvolt attracted a star-studded roster of investors, bringing in an unprecedented $15 billion in startup funding, with Goldman Sachs and Volkswagen leading the charge.
Expertise was another major strength. Northvolt’s founders, Peter Carlsson and Paolo Cerruti, were former Tesla executives with deep experience managing global supply chains. Battery production seemed like a logical extension of their expertise. Northvolt also established partnerships with leading suppliers from Japan, South Korea, and China, bringing seasoned professionals to its facilities and enabling technology transfers.
100 countries, including experts from South Korea and China.
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