STOCKHOLM — Volvo Vehicles plans a three way partnership with Swedish battery maker Northvolt to develop sustainable batteries for its electrical automobiles and arrange a gigafactory for manufacturing.

The businesses purpose to arrange a analysis and improvement middle in Sweden to start operations in 2022 and begin a gigafactory in Europe with a possible capability to provide as much as 50 gigawatt hours (GWh) per 12 months in 2026.

“Working intently with Northvolt may also enable us to strengthen our in-house improvement capabilities,” mentioned Volvo CEO Hakan Samuelsson mentioned in an announcement.

Northvolt will develop into Volvo Vehicles’ unique battery cell manufacturing companion in Europe.

The gigafactory might be powered by clear vitality and is anticipated to make use of round 3,000 folks. The situation of the plant has but to be determined.

Northvolt raised $2.75 billion in fairness this month to broaden capability on the manufacturing facility it’s constructing in northern Sweden, and Volvo plans to supply battery cells from that battery plant beginning in 2024.

Volkswagen is Northvolt’s greatest shareholder and the battery maker has additionally obtained contracts value billions from the likes of BMW and Scania.

Battery makers are scrambling to maintain up with demand as carmakers change to electrical in an effort to cut back planet-warming carbon emissions.

Volvo Vehicles goals to promote 50 % pure electrical automobiles by the center of this decade, and by 2030 it goals to promote solely totally electrical automobiles.

An electrical successor to Volvo’s XC60 mannequin would be the first automotive to function battery cells developed by the three way partnership.