Swedish battery maker Northvolt has snapped up Cuberg to gain access to the Silicon Valley startup’s technology, which will boost the energy density and range of electric-vehicle batteries.
Northvolt, which was founded by former Tesla
TSLA,
employee Peter Carlsson in 2016 and is 40% owned by Volkswagen Group
VOW,
said Cuberg’s batteries would be deployed in electric aircraft within three years, and in cars by 2025.
Carlsson said that the acquisition would help Northvolt improve both performance and safety while driving down cost for next-generation battery cells.
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“This is critical for accelerating the shift to fully electric vehicles and responding to the needs of the leading automotive companies within a relevant time frame,” he said in a statement on Wednesday.
Terms of the deal weren’t disclosed.
The deal comes amid a global race to produce the most powerful and efficient batteries for a fast growing market of electric-vehicle manufacturers. European car makers are scrambling to invest in battery technology for the next generation of electric vehicles that will allow them to compete against Tesla and Chinese rivals like NIO
NIO,
XPeng
XPEV,
and BYD
1211,
UBS
UBS,
projects that electric vehicles will have completely penetrated the automobile market by 2040, with batteries representing the main cost down driver for EVs.
Analysts at the Swiss bank predict that the required battery cell supply to meet this demand will result in global shortages by 2025, with battery manufacturers LG Chem
051910,
and Contemporary Amperex Technology Co. Limited, or CATL
300750,
poised to benefit. Northvolt’s location in Europe — the second-largest market for electric vehicles after China — makes it a prime challenger for LG Chem and CATL.
Northvolt supplies its cells to companies including ABB
ABB,
BMW
BMW,
Siemens
SIE,
Swedish state-owned Vattenfall, and Scania, owned by Traton
8TRA,
The company is on a mission to build the world’s greenest battery and has two gigafactories under construction in Sweden and Germany.
Privately owned Northvolt is also backed by Goldman Sachs
GS,
Scottish asset manager Baillie Gifford, and Spotify
SPOT,
Chief Executive Daniel Ek. It has raised $3.3 billion in funding, according to Crunchbase, including $600 million raised in its latest funding round in September 2020.
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Cuberg’s breakthrough battery technology is optimally designed for commercialization, Northvolt said. Its battery cells can deliver 70% more range and capacity than comparable cells designed for high-rate electric aviation applications, and Northvolt will work with Cuberg to mature its batteries for automotive and industrial use. By 2025, the group aims to industrialize battery cells with much higher volumetric energy density than is currently seen in the sector.
As part of the deal, Northvolt will establish an advanced technology center in Silicon Valley that will focus on materials research and the development for lithium-ion anode and electrolyte technologies.
Cuberg, which is backed by plane maker Boeing
BA,
the California Energy Commission, the U.S. Energy Department and the TomKat Center at Stanford, counts Boeing and aircraft developers Ampaire and VoltAero among its customers.
