Volvo Cars pauses battery factory after fruitless partner search

Stockholm: Swedish automaker Volvo Cars said Tuesday that it was pausing operations at a battery factory under construction, dismissing all 75 workers...

Stockholm: Swedish automaker Volvo Cars said Tuesday that it was pausing operations at a battery factory under construction, dismissing all 75 workers there, after failing to find a partner for the business.

Volvo Cars, majority-owned by the Chinese conglomerate Geely, last year took full control of NOVO Energy, a subsidiary it had previously shared with Northvolt, a battery maker that went bankrupt in March.

Northvolt's failure, one of the biggest in Swedish corporate history, highlights the difficulties for EU battery producers facing by high costs and Chinese competition.

Last month, the EU Commission said it would provide 1.5 billion euros ($1.76 billion) to support the bloc's battery producers through interest-free loans. NOVO Energy, founded in 2021, was to build a mega battery factory supplying Volvo Cars and Geely-owned Polestar.

But the business requires an external technology partner, which Volvo said it had failed to find after a search it started last year.