Northvolt under pressure: fraudulent financing and political consequences!

Northvolt under pressure: fraudulent financing and political consequences!

In Schleswig-Holstein, everything currently revolves around the plans of the battery manufacturer Northvolt, whose fate was recently cast in a negative light by a report from the Federal Audit Office. Politicians are now demanding clear perspectives for the project, which is considered crucial for Germany's independence in battery cell production. According to many decision-makers, the optimistic assessment of Northvolt's situation by the Federal Ministry of Economics, then under Robert Habeck (Greens), did not reflect reality. According to NDR, the ministry has granted loans worth three-digit millions for the construction project in Heide. But the future is uncertain: a committee of inquiry is called for to shed light on the background.

But what's really behind the scenes? Northvolt, as one of the leading players in lithium-ion battery cell production, has great potential. The company intends to produce battery cells for up to one million electric cars annually in Heide. The interest even extends beyond national borders, as Germany is cooperating closely with other EU member states in setting up its battery cell production, as the BMWK informs. Joint battery innovations are being promoted via two IPCEIs (Important Projects of Common European Interest).

Risks and challenges

Northvolt's rise was not without problems from the start. Dirk Christian Dohse from the Institute for the World Economy noted that there were early warning signs that should not be ignored. For example, Volkswagen, Northvolt's largest shareholder until its bankruptcy in 2025, devalued its shares in 2024. Doubts about the financing through convertible bonds and subsidies were already raised in the Schleswig-Holstein Ministry of Economics and Finance, and in 2023 the state government asked the Federal Ministry of Economics critical questions regarding the financial risks.

But why weren't these warnings taken more seriously? Opposition politicians such as Kianusch Stender (SPD) and Bernd Buchholz (FDP) express concern about the state government's orientation towards the PricewaterhouseCoopers (PwC) report. It is also surprising that, despite all the skepticism, civil engineering work and infrastructure measures in Heide are continuing and hope for a new investor in the region has not been given up.

Status quo and consequences

The news about Northvolt's insolvency in Sweden and the application for creditor protection in the USA has raised eyebrows again. While the production facility in Heide is not officially affected by the bankruptcy, production at the main factory in Skellefteå is only running at reduced levels. Schleswig-Holstein's Prime Minister Daniel Günther (CDU) has now taken responsibility for the wrong decisions and is committed to the location and its importance for battery production in the country.

In the meantime, there are other topics that determine the agenda of the Schleswig-Holstein state parliament. Smaller political steps, such as banning cell phone use in schools up to the 9th grade and defusing a World War II bomb in Kiel, are also in focus. Despite all the challenges, the path to strengthening battery production and the associated innovations in the region remains of great importance, as various politicians emphasize.

It remains to be seen what specific steps will be taken next to overcome the challenges surrounding Northvolt and lead the Heide location into a successful future.