Volvo is halving the workforce at the battery company it co-owned with the defunct Northvolt battery manufacturer in a bid to slash costs.
The automaker blames a slowdown in consumer demand for battery-electric vehicles plus the uncertain economic conditions exacerbated by the punitive U.S. tariffs on imported automobiles, Reuters reports.
In a company statement, Novo Energy CEO Adrian Clarke says the “market conditions have made it impossible to maintain our operations at the current scale.”
Novo was formed in 2021 when Northvolt teamed up with Volvo Cars to build a dedicated battery factory in Gothenburg on Sweden's west coast. Northvolt later declared bankruptcy.
The latest staff cutbacks follow a 30% reduction in employees enacted since the beginning of this year. Layoffs just announced cut another 150 jobs, a Novo spokesperson says.
Novo, now in the sole ownership of Volvo, adds that producing batteries with a new technology partner in the Gothenburg area of Sweden remains its primary long-term objective.
While construction of the factory is near completion, no battery equipment has been installed, according to Volvo CEO Hakan Samuelsson. While agreeing that the project needs a technology partner, he also says it would be necessary to share the plant with other brands of the Geely-owned automaker.
