BMW cancels $2 billion deal with Swedish EV battery supplier Northvolt
BMW has decided to cancel a $2 billion contract with Swedish electric vehicle battery supplier Northvolt. This move comes after reports that Northvolt was unable to deliver on time for the supply contract signed in 2020. The deal was initially worth $2.3 billion and specified that Northvolt would start producing electric car batteries for BMW in 2024. However, BMW has now shifted its focus to developing next-generation battery cells with Northvolt.
Northvolt still has deals with Volvo and Volkswagen Group
Despite losing the contract with BMW, Northvolt still maintains partnerships with Volvo and the Volkswagen Group. The Swedish firm has a joint-venture battery plant with Volvo, expected to produce cells for an electric Volvo XC60 SUV. Additionally, Northvolt has a German factory as part of its partnership with the Volkswagen Group. These partnerships highlight Northvolt’s continued presence in the EV battery market, even without the deal with BMW.
BMW switches to energy-dense cylindrical battery cells
BMW has decided to shift to using more energy-dense cylindrical battery cells for their next-generation Neue Klasse EVs. This change is expected to improve energy density and charging performance in BMW’s electric vehicles. The company plans to assemble the Neue Klasse EVs at two European sites starting from 2025, with production for the North American market set to begin at a Mexico factory in 2027.
BMW’s battery supply partnerships
In addition to the canceled deal with Northvolt, BMW has existing contracts with other battery suppliers such as Samsung SDI and CATL. Both of these Asian companies have factories in Europe, providing BMW with a diverse range of battery supply options. The cancellation of the Northvolt deal may lead BMW to reassess its battery supply strategy and explore other potential partnerships in the future.
The future of BMW’s electric vehicle plans
Despite the setback with Northvolt, BMW remains committed to transitioning towards electric vehicles. The company’s focus on developing next-generation battery cells demonstrates their dedication to sustainability and innovation in the EV market. As BMW continues to expand its electric vehicle lineup, they will likely seek out new partnerships and technologies to stay at the forefront of the rapidly evolving automotive industry.