Freyr Battery, a Norwegian battery manufacturer, has announced a significant downsizing of its operations and a temporary suspension of battery cell production at its Mo i Rana plant. The decision is in response to current market challenges, particularly increased competition from Chinese manufacturers.
On Thursday, CEO Tom Jensen informed employees of the workforce reduction necessary to maintain the company’s financial viability. The Mo i Rana site, which currently employs approximately 60 of Freyr’s total workforce of 180, is expected to experience the most significant staff reductions.
The company attributes this decision largely to the competitive pricing of battery cells manufactured in China. Jensen said that customers’ reluctance to pay higher prices for Norwegian-made products has made it difficult to remain competitive in the market.
Despite these challenges, Freyr maintains that Mo i Rana remains the most suitable location for battery production in Norway and will maintain some operations there. The company intends to adapt the battery factory to focus on assembling larger, higher voltage battery packs from individual cells.
This announcement follows a previous restructuring effort in November 2023, which resulted in the loss of 78 jobs across the company. It also represents a significant shift from Freyr’s original plans, which called for 1,500 employees at the Mo i Rana plant alone.
Freyr, which has received significant government support, including NOK 200 million in direct funding and additional loan guarantees, will now reassess its strategy to align with the current dynamics of the battery market.
Source: HighNorthNews