The investment, which is part of a $ 2.75 billion funding round launched by the lithium-ion battery maker, will keep Volkswagen’s stake stable at around 20% and follows an initial investment of $ 900 million. euros in 2019.
“With this investment, we are strengthening our strategic partnership with Northvolt as a supplier of sustainable battery cells that are produced using renewable energy and are fully recyclable,” said Volkswagen CFO Arno Antlitz.
The last funds are to be used for capacity expansion in production, recycling and research and development, Volkswagen said.
Northvolt effectively forms the first of six gigafactories that Volkswagen plans to launch in Europe by 2030 to secure batteries as part of its efforts to overtake Tesla as the world’s largest electric vehicle player.
Northvolt will begin producing cells for Volkswagen from 2023, with capacity for Europe’s largest automaker to increase to 40 gigawatt hours per year over time, the company said.