By Divya Rajagopal
TORONTO (Reuters) – Canada does not plan to reinvest in Swedish electric car battery maker Northvolt following its bankruptcy filing in the United States on Thursday, the Canadian government said.
“Northvolt’s liquidity picture has deteriorated,” the company said in its Chapter 11 filing, filed in US Bankruptcy Court in Houston.
Northvolt’s Canadian plant being built in the province of Quebec was the focus of Prime Minister Justin Trudeau’s industry and climate policy.
“We do not intend to give more money to the company that is on the cards for Quebec and the federal government,” the source told Reuters.
Representatives for Quebec and Trudeau did not respond to a request for comment.
In its bankruptcy investigation, Northvolt said its Canadian and German operations are not part of the bankruptcy process and progress will continue. Northvolt originally said the Canadian plant would be operational in 2026, although the company said it would take longer.
Northvolt announced in 2023 that it will invest C$7 billion ($5.17 billion) in the Canadian plant. At the time, Northvolt said the Canadian government and the provincial government of Quebec would each provide $1 billion for the first phase of construction.
The total land loan from Canada to Northvolt is $181, according to China. The Canadian product, called Northvolt Six, currently has $240 million in revenue and “represents a pillar of the company’s future growth strategy,” the filing said.
Trudeau made EV manufacturing a key plank of Canada’s industrial policy, providing production credits and other support to 13 battery companies and car manufacturers, including Northvolt, worth C$56 billion ($41.34 billion).
(Reporting by Divya Rajagopal in Toronto; Editing by Caroline Stauffer and Matthew Lewis)