Germany is lobbying Northvolt to build its second large-scale battery factory in the country

According to Bloomberg, Germany is urging Swedish battery manufacturer Northvolt AB to build a second large-scale battery factory in the northern part of the country, as part of its ongoing efforts to attract green investments.

On June 3rd, German Economic Minister Robert Habeck spoke at a business conference in Bad Saarow, suggesting that Northvolt should build another factory in the northeastern state of Mecklenburg-Vorpommern, to synergize with the €5 billion (US$5.4 billion) factory currently being constructed in the town of Heide.

Habeck also mentioned investments from other companies in the country's battery production sector, such as BASF Europe's investment in Schwarzheide and Volkswagen's investment in Zwickau. Habeck added, "Northvolt has the potential to expand its investment in Heide to another region of Germany - Mecklenburg-Vorpommern."

Habeck pointed out that there is a surge in technology investments in eastern Germany.

"Many significant investments are being made in eastern Germany. Tesla has plans to expand its battery factory in the state of Brandenburg. New semiconductor factories are almost all located in the east, with a cluster effect centered around companies like Intel, TSMC, Infineon, and Global Foundries. This network may further expand in the future," said Habeck.

Supported by the newly relaxed EU state aid plan, Northvolt began constructing its Heide factory in March. This project aims to supply batteries for electric vehicles and will receive slightly more than €900 million in aid and guarantees from Germany. These incentives help ensure the smooth progress of the project and prevent it from being lured to the United States. German Chancellor Olaf Scholz views this investment as the latest example of the government's efforts to modernize and secure its manufacturing base.

Northvolt's Heide factory, which relies on wind power, plans to employ about 3,000 people and will start operating in 2026. With an annual production capacity of 60 gigawatt-hours (GWH), it will become the largest battery factory in Germany, capable of powering approximately 1 million electric vehicles.

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