Northvolt, once the most promising and highly valued new energy battery company in Europe, recently announced bankruptcy proceedings. At the beginning of its establishment, the company was seen as a hope for the European new energy industry, and the bankruptcy of Nord Voeux forced Europe to rethink how to find development opportunities in the electric vehicle supply chain. In 2016, former executives of Tesla, Peter Carlson and Paul Cerruti, founded the North Ford Company. This Swedish based power battery manufacturer has been hailed as the cornerstone for European car manufacturers to achieve their electrification goals and even the hope for the revival of European manufacturing since its establishment. The European industry once regarded it as a direct response to the US Inflation Reduction Act, indicating that Europe can compete with the US in the field of new energy vehicles. As the first domestic electric vehicle battery manufacturer in Europe, Northrop quickly attracted nearly $15 billion in investment and orders with a total book value of over $50 billion after its establishment, and plans to expand further through $20 billion in stock market financing. However, contrary to expectations, Beifu, who was born with a golden spoon in his mouth, soon revealed many problems. In the power battery manufacturing industry, large-scale production is crucial. In order to challenge Chinese power battery giants such as CATL in terms of cost, Beifu's expansion strategy can be described as ambitious: it launched the construction of four large factories in three countries before the first factory was fully put into operation. Beifu is also trying to find breakthroughs by expanding its business scope, no longer limited to the lithium-ion battery field dominated by China, but turning to emerging fields such as battery recycling and sodium batteries. And it is precisely this strategy that brings hidden dangers. Many industry insiders have analyzed that although Beifu is trying to avoid Chinese influence, it still needs a large number of Chinese made equipment and Chinese skilled workers to operate these devices. However, issues such as poor communication and hardware incompatibility have resulted in the flagship factory's production capacity reaching only 1% of its design value, and the inefficient production capacity has prevented Beifu from generating sufficient revenue to fill the huge financial gap. In 2024, Beifu experienced a series of production safety accidents, insufficient production capacity, and delivery delays. As of the end of November, the company only had $30 million in cash to sustain operations for a week, but was burdened with nearly $6 billion in debt. In the end, Beifu filed for bankruptcy protection, and the company's co-founder and CEO Peter Carlson resigned. Many investors suffered heavy losses: Volkswagen's 1.4 billion euro stake in Northern Volta is now worth less than half, while Goldman Sachs reportedly lost $900 million. Bill Sanne, President of Generate Capital, a clean energy investment company, told European media analysis that Northern Volta lacks caution in fund management, consumes funds at an extremely fast pace, diversifies investments between multiple facilities and technologies, and ignores the core human resources required for large-scale industrial facility construction and operation, using excessive funds to develop "academic" intellectual property. Several former employees of Beifu stated in interviews with European media that many people within the company believe that Beifu itself has deep flaws. An employee said frankly: "We have no technology, no experience, and everything is taught by Chinese hands. They provide machines, and they build factories. Without them, we can do nothing." Jonas Namm, a political economist at the School of Advanced International Studies of Johns Hopkins University, believes that the lesson of the bankruptcy of North Volts is that the power battery industry cannot win international market competition only by relying on trade barriers and subsidies. The only way to win this competition is to carry out technical cooperation, not close the door, and let European manufacturers start from the beginning, which means opening the door for Chinese investment and establishing training partnerships with Chinese companies. In recent years, the EU has increased its policy support and financial investment in the power battery industry, reflecting its ambition and challenges. To reduce dependence on Asian power battery manufacturers, the European Union has launched the "European Battery Union" plan, aimed at promoting localization of battery production. Prior to the bankruptcy of the Northern Power Company, several European companies and think tanks had high hopes for EU invested battery companies. According to an analysis report by the think tank "Transport and Environment" in May this year, it is expected that Europe will achieve complete self-sufficiency in batteries by 2026 and meet the demand for most key components such as cathode materials by 2030. The EU is also striving to promote local processing of key minerals and reduce dependence on overseas markets. Finland plans to build a center for lithium refining in Europe, while Germany is increasing investment in battery recycling technology. The EU also plans to provide more funding for clean energy and power battery projects through the "European Green Deal" fund. France, Germany, Sweden and other countries have jointly called for simplifying the approval process for the construction of power battery factories to shorten the construction period and improve project execution efficiency. The implementation of the EU Battery and Waste Battery Regulation further emphasizes the sustainability of power battery production, requiring manufacturers to reduce their carbon footprint and increase battery recycling rates. Relevant data shows that the European power battery industry has performed well in carbon footprint control. If the EU power grid is used, the carbon emissions from battery production can be reduced by 37%; By relying entirely on renewable energy, carbon emissions can even be reduced by 62%. Despite receiving certain support in the areas of policy, technology, and funding, the development of the European power battery industry still faces many challenges. Firstly, the growth rate of the electric vehicle market has not met expectations, especially in major European markets where high prices and inadequate charging facilities have deterred consumers from purchasing electric vehicles, resulting in slow sales growth. Meanwhile, European domestic power battery companies do not have an advantage in cost compared to their Chinese competitors. In addition, key raw materials such as lithium, nickel, and cobalt required for power battery production mainly rely on imports from Africa, South America, and Asia. This external dependence makes Europe's supply chain vulnerable to geopolitical tensions and international market price fluctuations. Who will save Beifu? After the crisis of the Northern Volta company, the Swedish government called on the European Union to increase its support for the power battery manufacturing industry. On November 28th, Swedish Deputy Prime Minister and Minister of Energy and Economy, Ebba Busch, stated in Brussels that the financial difficulties of Nord Voeux are not only a "crisis in Sweden", but also a sign of a "crisis in Europe". She urged the new European Commission to accelerate the approval process and develop more investment strategies. Bernhard Krutig, State Secretary of the German Federal Ministry of Economic Affairs, also expressed support for North Germany, stating that European power battery production is "crucial for the automotive industry". He reiterated that the German federal government will continue to support Nord Voeux and plans to provide approximately 900 million euros in funding for the construction of its battery factory in Schleswig Holstein. However, due to the current financial difficulties of Beifu Company, the construction of the project may be delayed. According to Swedish media reports, the total debt of Nord Voeux has reached $5.84 billion, with some of the debt directly related to the European Union. European Commission spokesperson Nuitz Weiller told the media, "We have provided guarantees for multiple loans provided by the European Investment Bank to the battery factory of North Volta. Currently, North Volta's debt to the EU has reached $313 million, which is guaranteed by the European Strategic Investment Fund." At the same time, North Volta is also seeking self rescue. Multiple European media outlets have reported that since last year, Nord Voeux has been in talks with multiple global companies to explore the possibility of further financing or mergers and acquisitions. It is worth noting that some well-known Chinese power battery companies are among the contacts of Beifu. Many industry experts have pointed out that in recent years, the European Union has gradually tightened its scrutiny of foreign investment under the pretext of "economic security". In this year's EU legislative draft, the power battery industry has been included in the scope of consideration for EU foreign investment review. Therefore, it is still unknown whether the European Union and the Swedish government can allow North Germany to seek assistance through foreign investment. (New Society)