Two Tesla Motors’ veterans want to build a European counterpart to Elon Musk’s “gigafactory”, in an effort to stake out a dominant position in the fast-evolving supply chain for makers of electric vehicles.
CEO Peter Carlsson and chief operating officer Paolo Cerruti are the two people behind Northvolt, a Swedish-based startup that wants to use the country’s green energy credentials, vibrant venture capital scene, and its access to key raw materials to create what would be the single biggest plant for lithium-ion batteries in Europe.
Northvolt aims to build a factory capable of making 32 gigawatt-hours of battery packs a year by 2023, at a cost of just over 4 billion euros (for context, Tesla has set the initial capacity for the Gigafactory at 50 GWh, with the aim of expanding it ultimately to 150 GWh).
Europe has lagged Asia and the U.S. in the battery field so far. But Volkswagen’s diesel emissions scandal has forced a major strategic shift on the region’s carmakers. VW, which controls a quarter of the European market, now wants a quarter of its new cars sold to be electric by 2025. Strict new fuel-efficiency regulations from the EU will put pressure on others to at least keep pace with that migration beyond combustion engines.
