Northvolt’s collapse: A tale of reckless extravagance and blurred focus

Northvolt’s collapse not only exposes the vulnerabilities of industrializing complex high-voltage batteries but also highlights that excessive spending and inefficient capital allocation can be severely unforgiving no matter how strong ESG credentials get

Fewer than two years after the collapse of Britishvolt, one of the most promising battery startups in the UK, Swedish battery maker Northvolt filed for chapter 11 in the US on Nov. 21. The filing followed its failure to scale up production as planned at its flagship gigafactory in Skellefteå, Sweden and raise more funds to rescue its operations. While Northvolt’s collapse is seen as another setback to Europe’s battery ambitions, it also underlines a wider trend of new-age, clean-tech startups with easy access to public and private funds eventually enduring financial difficulties due to lack of experience and execution capabilities.