Volvo Car Group is to establish a partnership with Swedish battery company Northvolt to develop and produce batteries to power the next generation of pure electric Volvo and Polestar cars.
As a first step for the 50/50 joint venture, Volvo Car Group and Northvolt aim to set up a research and development centre in Sweden that will begin operations in 2022.
The planned joint venture will also establish a new gigafactory in Europe with a potential capacity of up to 50 gigawatt hours (GWh) per year. Production is scheduled to start in 2026.
As part of the plans, Volvo Car Group is also looking to source 15 GWh of battery cells per year from the existing Northvolt Ett battery plant in Skellefteå, Sweden starting in 2024.
Volvo Cars aims to sell 50% pure electric cars by the middle of this decade, and by 2030 it aims to sell only fully electric cars.
The new gigafactory, planned to be powered by 100% clean energy, is expected to employ about 3,000 people.
Its location is yet to be decided but the first car to feature battery cells developed through the joint venture will be the electric successor to Volvo’s XC60 model.
Håkan Samuelsson, chief executive at Volvo Car Group said, “By working with Northvolt we will secure a supply of high-quality, more sustainable battery cells for our pure electric cars.
“Working closely with Northvolt will also allow us to strengthen our in-house development capabilities.”
Peter Carlsson, Co-Founder and CEO of Northvolt added, “Volvo Cars and Polestar are industry leaders in the transition to electrification and perfect partners on the journey ahead as we aim to develop and produce the world’s most sustainable battery cells.
“We are proud to become their exclusive battery cell production partner in Europe.”