The company will build '2170'-style cylindrical batteries, the same cells used in the Tesla Model 3.A Swedish startup led by former Tesla executives aims to build a Gigafactory-scale battery plant somewhere in Scandanavia.Known as Northvolt, the startup is hoping to start production in 2020 and ramp up to 32 gigawatt hours of annual output capacity by 2023, according to a Financial Times report.
The production goal is not far below Tesla's 35 GWh target for 2018 production at its Nevada Gigafactory.
Northvolt chief executive Peter Carlsson, formerly Tesla's supply chain head, suggests the factory is not intended to be a rival to Tesla. Rather, it intends to compete with Asian suppliers that currently dominate the battery supply industry.
"It's an automated process; you don't need cheap labour but you do need skilled engineers," he told FT. "Energy is a very important part of cost. Europe needs to do something."
The company apparently expects other automakers and industries to follow in Tesla's footsteps and adopt the new '2170' battery cell design. The cylindrical 2170 design was co-developed by Tesla and Panasonic, replacing the slightly smaller 18650 battery that is used for a broad range of products from flashlights to the Model S. Tesla intends to use the new cells for the Model 3.
The 2170 number simply refers to the battery's dimensions -- 21mm by 70mm -- allowing any battery maker to create individual lithium-ion cells using the same format. Samsung and Northvolt both plan to produce their own 2170 batteries.
Northvolt expects the 32 GWh plant to cost around $4 billion. Funding consequently poses the greatest challenge, but Carlsson suggests there is "tremendous interest in investing in the transformation that is about to happen."
Many mainstream automakers, including Volkswagen and Honda, expect electrified vehicles -- equipped with lithium-ion battery packs -- to account for a large portion of their overall sales in the next decade.