Published by Global Banking & Finance Review®
Posted on August 25, 2025
6 min readLast updated: January 22, 2026
Add as preferred source on GoogleLyten acquires Northvolt's assets to revive European battery production, focusing on lithium-sulfur technology while seeking investor confidence.
By Marie Mannes, Alessandro Parodi and Gilles Guillaume
STOCKHOLM (Reuters) -Silicon Valley startup Lyten will need to convince carmakers it can succeed where bankrupt Swedish EV battery maker Northvolt failed - creating a European champion to reduce the region's reliance on China.
Lyten, which develops lithium-sulfur batteries, unexpectedly announced on August 7 it was buying Northvolt's assets, offering a lifeline to future European battery production for electric vehicles.
But customers and investors burned by the Northvolt experience remain wary of committing without seeing a proven product that can be delivered at scale, interviews with over a dozen battery industry experts, analysts and car company sources revealed.
As well as taking on Northvolt's production of lithium-ion batteries, Lyten plans to develop its own lithium-sulfur batteries for EVs, but will need substantial funds and lacks the Swedish company's erstwhile $50 billion order book.
Lithium-sulfur cells are one of several next-gen battery chemistries, promising a lighter, lower-cost alternative and lower dependence on critical minerals from China, but are still in their infancy.
Lyten currently produces lithium-sulfur cells at a pilot plant in Silicon Valley.
Jeep-owner Stellantis has - with a 2% stake - been in partnership with Lyten since 2023 to explore applications of Lyten's lithium-sulfur technology, including for battery cells, lightweight composites and on-board sensors.
A Stellantis spokesperson said any supply deals would depend on technical validation, industrial scale-up, local production capacity and commercial terms.
Northvolt, despite attracting backers including Goldman Sachs, collapsed with $8 billion in debt in March after losing orders and key investor support, and missing production targets.
Carmakers scaling down their electrification plans have also hit EV battery demand.
Northvolt's flagship factory in Skelleftea, Sweden, however, was starting to turn around in the weeks before closure, ramping up production to 30,000 lithium-ion cells a week.
Lyten CEO Dan Cook told Reuters that he hopes Northvolt's previous customers - which included Volkswagen brands - will return if the company proves itself by delivering consistently to a single, undetermined, customer at low volumes with good quality.
Former Northvolt-backer Scania said it was too early to discuss ordering cells from Lyten. Volvo Cars, which had partnered with Northvolt via its nascent battery unit Novo Energy before cutting ties, declined to comment on whether it would place orders.
"Lyten is not a name anyone would have associated with lithium-ion manufacturing until 24 hours ago," said James Frith, at battery-tech focused venture capital Volta Energy Technologies, shortly after the deal was announced.
A person familiar with Stellantis-backed battery maker ACC, another contender to be a European battery champion, said ACC is in talks with three former Northvolt clients, but no new contracts are expected before mid-2026.
RECHARGING HOPES
Lyten has not said how much it paid for Northvolt's assets, only that it bought them at a "substantial discount", fully funded through equity investment from private investors.
Cook told Reuters that Lyten had a strong investor base including money managers and high-net-worth individuals, which had expanded following the Northvolt transaction.
"This allows us to create syndicates of investors, and from that base we will continue to receive large investments," Cook said.
The company plans further large capital raises and aims to tap European grant programmes such as the European Union's battery booster package.
BMW, which cancelled a 2 billion euro ($2.32 billion) order with Northvolt last year after quality problems, said it was keen to see the establishment of a European manufacturer of high-quality sustainable cells but added battery cell supply deals need a "long lead time".
"In this respect, Northvolt's successor would only be considered for a future battery cell project – that is still a long way off, and we cannot comment on it at this stage," a BMW spokesperson said.
A battery scientist at another European carmaker, who declined to be named, said the firm backed away from working with Lyten six months ago because it was only producing at R&D scale. Still, the Northvolt deal could help reopen doors for additional talks with carmakers, the person added.
'VALLEY OF DEATH'
Acquiring Northvolt's production and R&D facilities would enable Lyten to reach large-scale lithium-sulfur EV battery cell production by 2028, rather than its previous, end-of-the-decade forecast, Cook said.
But experts caution that lithium-sulfur is unlikely to be viable for cars before 2030.
Lyten faces competition from the likes of Germany's Theion, Australia-based Gelion and Zeta Energy in the U.S., which also has a partnership with Stellantis, in the race to develop cells for EVs. Chinese battery giants, such as CATL, currently dominate the global battery market, but are focused more on 'semi-solid' to 'solid-state' batteries, which are further developed than lithium-sulfur cells.
Chief sustainability and marketing officer Keith Norman said Lyten was already two years into working with automaker partners on testing lithium-sulfur.
"We believe the market will continue to be surprised at the pace we bring lithium-sulfur into a wide range of markets," he said.
Northvolt built probably "one of the most advanced battery research centres in Europe," Norman told Reuters. "We have a very deep battery research and materials research capability in Silicon Valley. ... so we think that (linking the two) is going to allow for rapid innovation of batteries."
Still, Emma Nehrenheim, a former Northvolt executive recently appointed head of the European Battery Alliance, said it would take over five years and government subsidies for European battery makers to cross the so-called "death valley" of unprofitable production and become competitive with their Asian counterparts.
"Governments and investors need to understand that China spent 15-20 years and north of $150 billion to get where they are today, and if you think you can shortcut it then you just don't understand batteries," said Rob Anstey, CEO at silicon battery anodes developer GDI.
($1 = 0.8623 euros)
(Reporting by Marie Mannes, Alessandro Parodi, Gilles Guillaume and Christoph Steitz; Additional reporting by Norihiko Shirouzu; Editing by Adam Jourdan, Nick Carey, Matt Scuffham and Susan Fenton)
Lithium-sulfur technology refers to a type of battery chemistry that uses lithium and sulfur as the main components, promising lighter and lower-cost batteries compared to traditional lithium-ion batteries.
Investor confidence is the degree of optimism that investors feel about the overall financial market or a particular investment, influencing their willingness to invest.
A partnership in business is a formal arrangement where two or more parties agree to manage and operate a business together, sharing profits, losses, and responsibilities.
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