VW Representative Exits Cash-Strapped Northvolt’s Board

(Bloomberg) -- Volkswagen AG’s representative has left the board of Northvolt AB, adding to the uncertainty around the cash-strapped battery maker as it tries to raise funds.

Sven Fuhrmann, who has represented Volkswagen on the Swedish electric-vehicle supplier’s supervisory board since last year, has resigned, the companies said separately on Monday. VW — Northvolt’s biggest shareholder and a major customer — didn’t say whether it will replace him.   

“This decision has no impact on the shareholding of Volkswagen AG in Northvolt AB,” Volkswagen said in a statement. “We will not comment on further details of our contractual relationship with Northvolt or speculation against this background.” 

Fuhrmann’s departure comes as Northvolt works to stitch together a short-term rescue package that would tide the company over toward a longer-term plan. Replacing him would assuage concerns about the strength of the relationship, as VW’s Swedish truck brand Scania is one of the biggest buyers of Northvolt battery cells. 

VW declined to elaborate on its plans for the position. “Replacement is a decision of the board of directors of Northvolt AB,” the carmaker said. 

Swedish radio had earlier quoted a VW spokesman as saying it’s too early to say whether it will select a replacement for Fuhrmann. 

“Volkswagen is a longstanding partner of Northvolt, and we are in close cooperation with Volkswagen and their brands that Northvolt serves,” Northvolt said without elaborating.

The Swedish company’s troubles stem from failures to ramp up cell production at its main plant near the Arctic Circle in Sweden, and costs from its expansion have been piling up. In response, Northvolt has scaled back major projects and narrowed its focus to increasing output. It’s cutting 20% of staff globally.

Northvolt has in recent weeks communicated a wider pullback across Europe and North America, where the battery maker had hoped to build the manufacturing breadth needed to compete with lower-cost Chinese producers. Those expansion plans are now in tatters amid a string of operational setbacks and cooling demand for electric vehicles in key markets.

Chief Executive Officer Peter Carlsson last week flagged a long-term funding need of more than 10 billion Swedish kronor ($920 million) on top of a previously reported short-term package of about $300 million in funding that includes debt and equity. Northvolt spends about $100 million a month on operational costs, according to local media.

The news of Furhmann’s departure was first reported by Dagens Industri.

--With assistance from Niclas Rolander, Christopher Jungstedt and Jonas Ekblom.

(Updates with Volkswagen comment from second paragraph)

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