Swedish battery maker Northvolt has confirmed it will be able to pay its upcoming tax bill on October 14, dispelling speculation about the company’s ability to meet its financial obligations. The company, seen as Europe’s leading hope for a homegrown electric-vehicle battery producer, has faced increasing financial difficulties in recent months.
Responding to concerns over its financial stability, a Northvolt spokesperson told Reuters on Thursday evening, “On the question of whether we will pay our taxes when they fall due on the 14th of October, the answer is the same as for other companies and is a simple ‘yes’.”
Northvolt is due to pay 287 million Swedish crowns (USD 27.59 million) to the Swedish Tax Authority on Monday. However, financial struggles have cast doubt on the company’s future, particularly after a series of setbacks, including a job-cutting announcement in September, ongoing production challenges, and weakening demand for electric vehicle (EV) batteries.
Despite raising over USD 10 billion in funding and being hailed as one of Europe’s best-financed startups, Northvolt has been grappling with serious financial difficulties. In June, German automaker BMW canceled a USD 2 billion order, dealing a significant blow to the company’s prospects. The move raised fears about Northvolt’s long-term sustainability amid fierce competition from Chinese battery makers.
Adding to these troubles, earlier this week, Northvolt was reported to be seeking cash by selling redundant battery materials, and one of its units filed for bankruptcy. Furthermore, the head of Northvolt’s battery cell factory in Northern Sweden was replaced on Wednesday, signaling potential instability in its leadership.
The company’s ability to meet its tax obligations has been widely scrutinised, with industry insiders speculating that its financial situation might become untenable if it failed to do so. Northvolt’s confirmation that it will pay the taxes has temporarily quelled concerns, but doubts remain over its ability to navigate the growing challenges in the EV battery market.