Chinese battery-maker SVOLT Energy Technology has decided to close its European operations.
The decision comes after media reports said it had indefinitely suspended plans to build two battery plants in Germany.
The company will terminate the commercial operations of its European arm and its German subsidiary from 31 January, it told financial news outlet Yicai Global.
Yicai cited media reports saying the reasons included the high capital cost of the factories, disappointing sales growth for EVs, punitive tariffs, and the possibility that the EU will change its mind on banning the internal combustion engine.
The investment was to have been financed by an initial public offering in Shanghai, through which the company hoped to raise $2.1bn.
This money was to have financed an assembly plant in Saarland, Germany. The project, announced in November 2020, was to have produced 24GWh of batteries a year.
There was also to have been a factory in Brandenburg, northern Germany, with an annual capacity of 16GWh. This project was unveiled in September 2022.
Last October, SVOLT also announced plans to build a huge 50GWh factory in Europe, with Finland picked out as the likely location.
At the time, Hongxin Yang, the company’s chief executive, said the company was trying to expand rapidly so as to be able to meet an expected surge in demand for EVs.
He said: “We want to build further capacity as quickly as possible so that we can supply our customers outside of China. However, the decision in favour of a new location is always guided by several factors: Planning security and economic feasibility are the most important.”
The company used to be a part of the battery division of Hebei-based car-maker Great Wall Motors.
According to the China Automotive Power Battery Industry Innovation Alliance, SVOLT’s installed capacity in the first nine months of this year reached 9.97GWh, with a domestic market share of 2.9%.
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