Tsvetana Paraskova

Tsvetana is a writer for Oilprice.com with over a decade of experience writing for news outlets such as iNVEZZ and SeeNews. 

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• Trade uncertainty and tariffs are pushing firms to build where demand and policy are strongest, shifting expansion to Europe and Asia.
• Lyten pivots to Europe at scale.
• Washington State-based Group14 Technologies this week closed a $463-million funding round led by SK, Inc.

Trade uncertainty and tariffs are prompting America’s battery makers and battery material manufacturers to expand overseas to have production sites in the biggest demand centers now that clean energy isn’t a favorite with the U.S. Administration.     

The trend has become evident in recent weeks, in which two U.S. battery companies have taken over production sites in South Korea and Europe, betting on being close to customers in markets favoring green technology and renewable energy expansion.

First, it was California-based Lyten, which said in early August it would buy all remaining assets in Sweden and Germany of failed European battery firm Northvolt, which was Europe’s great hope to have a domestic giga-scale battery manufacturer. 

But Northvolt in March filed for bankruptcy in Sweden, unable to overcome mounting challenges including “rising capital costs, geopolitical instability, supply chain disruptions, and shifts in market demand.”

A few months later, U.S. battery maker Lyten signed deals to buy Northvolt’s assets in Europe and is considering acquiring a Northvolt Six battery manufacturing facility under construction in Quebec, Canada.

In total, Lyten’s acquisition includes assets valued at approximately $5 billion, including 16 GWh of existing battery manufacturing capacity, more than 15 GWh of capacity under construction, the infrastructure and plans to scale to more than 100 GWh, and the largest and most advanced battery R&D center in Europe, in Sweden’s Västerås.

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“The demand for European and North American made batteries is only growing,” Lars Herlitz, Lyten chairman and co-founder, said in a statement.

Lyten, whose investors and partners include FedEx, Stellantis, and Honeywell, currently manufactures lithium-sulfur batteries in Silicon Valley and is selling commercially into the rapidly growing drone and defense markets.

Upon close of Northvolt’s asset acquisition, Lyten plans to immediately restart operations in Skellefteå (Ett) and Västerås (Labs) in Sweden.

At Northvolt Drei in Germany, Lyten is working with Northvolt and the German government to continue the program to establish a battery manufacturing facility near Heide in Schleswig-Holstein, with 15 GWh of initial capacity.

Lyten plans to rehire a large part of the previously laid-off workers, while its collaboration with Northvolt’s prior anchor customers is progressing constructively.

“The acquisition of Northvolt’s assets brings the facilities and Swedish talent to accelerate this mission by years, just at the moment when demand for Lyten lithium-sulfur batteries is growing exponentially to meet energy independence, national security, and AI data center needs,” said Dan Cook, Lyten CEO and co-founder.

Resuming Northvolt’s operations would be a risky undertaking for Lyten, “but considering the current policy and demand climate, it makes sense for a predominantly US-based company to shift toward the European market,” said Connor Watts, battery raw material demand analyst at Fastmarkets.

While Lyten is pursuing large-scale battery manufacturing operations in Europe, another U.S. battery supply chain firm, battery materials manufacturer Group14 Technologies, is looking for growth in Asia, the world’s top battery manufacturing market.

Washington State-based Group14 Technologies this week closed a $463-million funding round led by SK, Inc. In addition, Group14 obtained full ownership of its joint venture with SK Inc located in Sangju, South Korea. Formed in 2021, the joint venture’s battery active materials (BAM) factory produces Group14’s flagship technology, SCC55, at EV scale to support the global battery manufacturing industry.

Group14 Technologies’ existing investors include Porsche Investments, ATL, OMERS, Decarbonization Partners, Lightrock Climate Impact Fund, and Microsoft Climate Innovation Fund.

Group14’s first and second BAM factories are located in Washington State. But the company is also expanding silicon battery infrastructure in Europe with a silane gas factory in Germany, which will supply a critical precursor for next-generation energy storage technologies.

“Strengthening regional supply networks and shifting to next-gen battery chemistries like silicon that reduce material dependency, is more than just risk management,” Group14 chief executive and co-founder, Rick Luebbe, told Techstrong IT earlier this month.

Commenting on the deal in South Korea, Luebbe said in a statement this week,

“We’re strengthening regional battery supply chains and safeguarding our customers from global trade uncertainty.”

By Tsvetana Paraskova for Oilprice.com

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