Stockholm, Jan 31 (Reuters) - Truck manufacturer Scania has intervened to support Northvolt in the day-to-day operations of its main plant in northern Sweden in a final push to improve quality and output at the struggling electric vehicle battery maker as it seeks additional funding.
Since November, Scania has deployed staff to Northvolt's Ett plant in Skelleftea, which is situated 200 kilometers below the Arctic Circle. Internal documents from Northvolt reviewed by Reuters outline Scania's strategy to assist the green tech company. The plant has a workforce of around 2,500 employees.
According to four Northvolt employees speaking to Reuters, Scania personnel, easily recognizable by orange visitor armbands, have been present inside the factory in recent months, with one mentioning sightings as recent as this week.
While acknowledging its involvement in supporting production ramp-up efforts at Northvolt's Ett plant, Scania declined to provide additional comments when approached by Reuters.
Under the undisclosed support plan, each Scania staff member collaborates with a Northvolt shift manager or team leader to guide teams and drive enhancements and standards, as noted in an internal presentation from early November.
The exact number of Scania employees involved in the initiative could not be confirmed by Reuters.
Northvolt, seen as Europe's leading contender to establish an EV battery powerhouse, faced significant challenges last year, culminating in a Chapter 11 filing on Nov. 21. Discussions with investors and creditors, including Scania and Volkswagen, collapsed due to ongoing quality concerns.
Although Scania has been a major customer of Northvolt since its inception, its direct involvement in the production marks a recent development and surpasses its engagement with other customers, reports from internal documents, court filings, and conversations with eight informed sources revealed.
In response to queries about Scania's engagement, Mikael Stenmark, Northvolt's chief safety union representative, confirmed to Reuters that the truck manufacturer is aiding the Swedish company in enhancing quality, organizational structure, and maintaining improvements.
Expressing gratitude for the partnership with Scania, Northvolt responded to Reuters' inquiries by stating that it is common for automakers to engage with suppliers to ensure production quality.
The involvement of Audi and Porsche, also customers of Northvolt, has been sporadic compared to the continuous presence of Scania staff, according to information from veteran employees.
Within the support plan, Scania staff were scheduled to participate in regular meetings with Northvolt's management and staff to offer updates and suggest improvement strategies.
A potential collapse of Northvolt, if additional funding is not secured soon, could impact Scania's access to EV battery sources, despite existing relationships with other suppliers. This scenario may potentially shift the European market to rely more heavily on Chinese battery manufacturers such as BYD and CATL.
Northvolt's need for significant capital injection to restructure its business was reported by Reuters on Tuesday, with its current funds estimated to deplete in a matter of weeks.
As a key investor in Northvolt with a 21% stake, Scania's dependency on the company for its e-trucks underscores the crucial nature of Northvolt's operations.
Following Northvolt's appreciation of Scania's production expertise and collaborative efforts dating back to 2017, the positive impacts of this partnership on Northvolt's operations have been highlighted.
Despite Scania's limited experience in battery production, its extensive history and expertise in establishing and scaling factories throughout Europe have been invaluable for Northvolt, providing optimism for the company's future prospects.