Chinese EV battery maker SVOLT is shutting down all European operations, including its German subsidiaries, and laying off staff.
The decision comes amidst regulatory conflicts between the EU and Chinese EV manufacturers, as well as declining EV sales in Europe.
SVOLT has faced financial difficulties, reporting cumulative losses and abandoning plans for a Shanghai IPO.
Chinese EV battery maker SVOLT is shuttering operations in Europe on the heels of a yearslong regulatory conflict between European lawmakers and EV manufacturing based in China.
As we have reported over the last year, EU authorities have been doing everything in their power to stifle EV production based in China, fearing that the lower cost models coming from the east are warping the European market and putting domestic producers at a disadvantage.
Now, the consequences are starting to rear their heads. Chinese EV battery maker SVOLT Energy plans to shut its European operations by January 2025, in a move that clearly points to China’s retreat from the market – and declining EV sales in Europe, according to Nikkei.
SVOLT, linked to Great Wall Motor, will close its German subsidiaries and lay off staff, according to a source.
Poor EV sales and financial pressures have driven Chinese battery maker SVOLT to shut all of its European operations, including its Frankfurt office, according to the same report.
The Nikkei report says that all SVOLT Europe employees will be laid off, though some were recently offered positions at the company’s China headquarters. The exact number of affected staff remains unknown, and SVOLT has not commented on the matter.
In 2020, SVOLT announced plans to invest €2 billion in two battery plants in Germany’s Saarland, creating up to 2,000 jobs. However, it halted plans for a plant in Lauchhammer due to losing a key customer and concerns over tariffs and subsidies.
A lawsuit and local protests have also delayed a planned factory in Ueberherrn until 2027. SVOLT’s Heusweiler plant, intended to produce battery packs, was set to open in July, but reports suggest the company has now ceased all production in Germany.
Meanwhile, just like in the U.S., the EV market in Europe is cooling. New car sales in the EU dropped 18% in August, with Germany down 28%, according to the European Automobile Manufacturers’ Association. EV market share fell 44%, with Chinese brand BYD selling only 218 cars in Germany, or 0.1% of the country’s EV sales.
SVOLT, spun off from Great Wall Motor in 2018, counts Geely Auto, XPeng, and Great Wall among its clients but has struggled financially, reporting a cumulative loss of 4.4 billion yuan ($618 million) from 2019 to 2022.
The company aimed to raise $2.1 billion through a Shanghai IPO in 2022 but abandoned the plan a year later.
Energy News Beat