"The Problem with Speed and Scale in Green Industrial Transitions. A Historical Perspective"

This study provides a historical perspective on the ongoing “green” transformation of the automotive industry. Over the past decade, investments in low-carbon technologies—such as automotive batteries, low-carbon steel, and clean energy—have grown rapidly. However, Europe and the United States are widely recognized as lagging behind China in technological leadership and production capabilities for alternatively powered vehicles. This study examines the case of Northvolt, a prominent yet struggling Swedish electric vehicle (EV) battery startup, situating it within the broader political and business history of the automotive industry’s transformation. Initially heralded as a crucial solution to Europe’s dependence on external battery supply chains, Northvolt was expected to support the European Union’s ambitious emissions targets by reducing reliance on Chinese inputs. Positioned as Europe’s flagship in homegrown battery production, Northvolt pursued rapid large-scale growth with substantial backing from Goldman Sachs and automakers such as Volkswagen and BMW. This study aims to identify historically rooted factors contributing to Northvolt’s challenges, thereby offering insights into the limitations of current green transition policies in Western economies.