European companies - leaders in the production of batteries for electric vehicles may in the near future be defeated in competition with China. This opinion was expressed by agency Bloomberg.
Battery companies such as Sweden's Northvolt AB may face problems due to strategic mistakes in their business development. The simultaneous increase in product production and cost reduction led the company to loss of quality and operational breakdowns.
The Swedish battery maker's losses tripled from 2022 to 2023, amounting to USD 1.03 billion, as a result of which the company announced the closure of several plants and a 20% layoff. This situation puts Northvolt AB in a vulnerable position and risks bankruptcy, similar to its British competitor Britishvolt, which closed in 2023. The European Union will be forced to admit defeat and grant access to its market to Chinese manufacturers in the event of bankruptcy of Northvolt AB, according to Bloomberg.
On October 4, the European Union increased tariffs on imports of Chinese electric vehicles, setting the maximum rate at 35%. China took this decision as an act of protectionism and announced the introduction of retaliatory measures against European products. Also, the Ministry of Commerce of the People's Republic of China announced on October 8 that it is conducting an anti-dumping and countervailing investigation on agricultural products from the European Union and is considering the possibility of increasing import duties on large-engine cars from the EU.