After two years and $510 million dollars, Quebec withdraws its support of Northvolt’s $7-billion battery factory in the province

Quebec and Northvolt are parting ways after the province announced it was ending its funding for a planned $7-billion factory and taking a $270-million loss from its total $510-million investment.

It’s been a rocky few years for both Quebec and Northvolt since the joint announcement in September, 2023 that the Swedish battery maker would be building a battery-cell manufacturing plant in McMasterville, Que.

After the announcement Northvolt was rocked by global EV supply issues throughout 2024, the election of Donald Trump in the United States late last year and then, finally, the bankruptcy of its parent company in March 2025.

In the midst of the turmoil, Northvolt announced it was pausing its plans to open a factory in Quebec in January 2024, but stated multiple times that the project — at least from the company’s perspective — was not dead.

By taking the action to end its arrangement with Northvolt, Quebec will have to write off the $270 million already paid out to the parent company in Sweden. The province originally committed to a total investment of $510 million, including what it calls a $240-million guaranteed loan which was to be used to purchase land for the factory site.

“We are obviously disappointed,” said Christine Fréchette, Quebec’s minister of economy.

“However, the outcome of the project does not mean the end of the battery industry here.”

Rising from the ashes?

After the province’s announcement, Northvolt issued a statement expressing disappointment at the decision and noted that it still has “substantial resources to relaunch the project.”

It’s unclear, however, how or in what form the project might be resurrected.

The Canadian Press reports that Quebec has already filed documents with the Quebec Superior Court asking that Northvolt be declared insolvent. Having the court take that action would allow the province to recover not just the $240-million principal of its loan but also $30-million in already accrued interest.  

One possible outcome of the judicial process could see the court ordering that the land be sold immediately. Should that happen, it’s unclear where Northvolt would relocate .

For now, however, the company says it’s focussed on its employees.

“We wish to underscore that Northvolt North America is not in bankruptcy,” reads Northvolt’s statement.

“[W]e remain committed to ensuring a smooth transition and to supporting our employees and partners throughout this difficult period.”

Meanwhile, Quebec is turning its attention to its other battery projects, says Fréchette.

“Our industry is very much alive with several companies active in this ecosystem. We remain convinced that it has a bright future, particularly in Bécancour, where nearly 3,000 people are working on the construction of the plants.”