MONTREAL — Northvolt AB has filed for bankruptcy protection in the United States, but said the move will not jeopardize the manufacturer’s planned electric vehicle battery plant in Quebec.
The Sweden-based parent company and several subsidiaries on Thursday filed for a court-supervised reorganization of its debt and assets under Chapter 11 of the U.S. bankruptcy code.
However, Northvolt said its Canadian subsidiary is financed separately and “will continue to operate as usual outside of the Chapter 11 process.”
The Northvolt plant, dubbed Northvolt Six and slated for construction about 25 kilometres east of Montreal, is a $7-billion undertaking that aims to churn out battery cells and cathode active material for electric vehicles.
“Northvolt Six is an essential component of the company’s future and we remain fully committed to seeing it through,” said Paolo Cerruti, Northvolt co-founder and CEO of Northvolt North America, which oversees the project.
“The execution plan for the site construction is proceeding diligently and prudently, including during the period of restructuring of the parent company in Sweden,” he said in a statement in French.
Nonetheless, concerns around Northvolt’s financial solvency have raised questions about a project to which Quebec and Ottawa have pledged $2.4 billion in funding.
In September, Northvolt announced it would shrink its operations in Europe and lay off 1,600 employees in Sweden, or about a fifth of its workforce.
Last month, Cerruti suggested that the company may have been overly ambitious, but said it had no intention of asking the provincial or federal governments for more money for its planned lithium battery plant in Quebec’s Montérégie region.
The manufacturer is in Quebec “to stay,” he assured industry representatives in Montreal on Oct. 28.
©2024 The Canadian Press
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