STOCKHOLM, May 13 (Reuters) - Volkswagen truck brand Scania has signed a battery supply deal with Sweden’s Northvolt and is in talks about making an equity investment as part of the startup’s efforts to raise 1.5 billion euros ($1.68 billion), Scania’s chief executive said.
CEO Henrik Henriksson told Reuters he could not disclose exactly how much capacity Scania had secured from Northvolt, which said earlier this year that it had sold roughly half of its planned 32 gigawatt capacity a year by 2023.
“It’s a substantial part,” he said.
“There will be a shortage of batteries for the automotive sector globally in the coming five to six years because there’s simply not enough capacity. So the more capacity we can get our hands on, the better we feel,” he added.
Northvolt, founded by ex-Tesla executive Peter Carlsson, is looking to spend 3 billion euros to build Europe’s biggest battery cell plant in Sweden, and is currently raising 1.5 billion euros in debt and equity to build the first 16 gigawatt.
The company’s plans, which include a potential second factory in Germany, are seen as a central part of Europe’s effort to compete with Asian rivals such as CATL and LG Chem, which have gained a lead by locking in supply deals with carmakers. ($1 = 0.8904 euros) (Reporting by Esha Vaish in Stockholm and Arno Schuetze in Frankfurt; editing by Jason Neely and Jan Harvey)