Northvolt and other so-called green industries must be nationalized immediately and run under democratic control, to save jobs and affected municipalities and ensure a real green transition, which capitalism is incapable of.
It is the poisonous combination of capitalism’s short-term profit motive and the chaos and anarchy of the market that has both caused Northvolt’s crisis and shattered the dream of a Nordic battery belt, as well as the crisis in the global battery and car industry. The short-sightedness and hollowness of capitalism’s alleged climate initiatives can be described as follows: ‘It didn’t take much for some of Europe’s largest car manufacturers to withdraw their environmental goals. One notch in the sales curve and the climate was no longer as important (…) The vision of the all-electric Volvo Cars, for example, only lasted three years and it is a ‘clear signal that the climate and the environment do not mean much when it comes down to it’ (Dagens Nyheter, Sweden’s largest morning newspaper, 14 September).
The fact that the ‘green’ industry has become yet another battleground in the power struggles of the imperialist powers and is increasingly surrounded by protectionist measures, which adds an extra dimension to the crisis. The collapse of Northvolt, which has received billions of euros in aid from the EU, would probably thwart European capitalism’s attempts to build up its own battery production.
But despite all that is at stake, it is not certain that the state will step in to try to ensure Northvolt’s survival. Within the right, especially extreme-right Sweden Democrats (SD) and parts of the right-wing The Moderate Party (M), as well as within the capitalist class, there is resistance to state intervention and the ‘green industrial investments’ in the north. This opposition has now been joined by grotesque ‘gloating’ and absurd claims that it is state support that has caused Northvolt’s crisis. The anti-climate SD party is keen to see Northvolt go under and take with it the entire ‘green’ industrial investment in the north, which is based on ‘doomsday rhetoric’ about the climate and which has ‘put the functions of the market out of play’ (SD’s Tobias Andersson, chairman of the Parliamentary Committee on Industry and Commerce, in Affärsvärlden on 9 August under the headline: ‘SD-top attacks Northvolt: ’Insatiable appetite for more support’).
The same right-wingers who are against state aid in this case have not, however, had any objections to the fact that the state has rescued major banks and that the state will pay SEK 300 billion for the Tidö parties’ (the three right-wing parties in government and the Sweden Democrats) new and unnecessary nuclear power.
However, it is unlikely to be the right’s neoliberal wing that decides the case. Instead, it is likely that there are new government initiatives and perhaps even more EU support to prevent Northvolt from failing, if possible. Even Dagens Industri, which can hardly be accused of being a friend of state aid, writes in an editorial on 11 September: ”That Northvolt survives this crisis and becomes successful is a Swedish interest. More people should say this out loud, especially leading politicians”. This points towards the fact that the ruling-class’s will to defend their own national capitalism will prevail. But this form of state capitalism — the state taking over losses to save the owners and the system — does not safeguard jobs or communities. It is not nationalization to enable coordination, planning and management of non-renewable resources, which is a prerequisite for a green transition.
Last week’s announcement that around 300 people will be made redundant and that a department producing some of the materials used in the batteries will be closed until further notice was preceded by several setbacks and promises that were never fulfilled.
When the first battery was produced just before New Year’s Eve 2021, the company said it would take 18 months to reach full production in the part of the factory that was ready. In reality, production has still not started after two years. The loss last year was SEK 12.5 billion.Earlier this year, BMW withdrew from a contract with Northvolt to supply batteries worth more than SEK 20 billion.
Problems with working conditions have been a recurring theme. Early on, an inspection by several authorities revealed systematic violations of working time rules and safety regulations. There were people who had worked 90 hours a week or 22 days in a row. More recently, four employees have died in unclear circumstances. The investigation into possible links to the working environment is still ongoing.
The major problems in keeping production running have already led to drastic measures. Recently, plans for a factory in Borlänge and a thousand new jobs were cancelled. What makes the situation even more difficult is that there will be a surplus of batteries on the world market in the coming years. According to the Bloomberg news site, global battery production capacity next year will be five times higher than demand.
We see a classic pattern of the capitalist economy. When a new, large and potentially profitable market emerges, many companies jump at the chance. The result is often overproduction and the elimination of companies. Northvolt is a striking example of the weakness of a capitalist-based ‘green transition’. The factory produces batteries with a significantly lower carbon footprint than average. But what good is that when the big customers are car manufacturers like Audi, Porsche and Volvo, which make big, heavy cars, making them anything but ‘green’?
The Northvolt crisis shows the huge financial risks many northern municipalities are forced to take in connection with large industrial projects. Skellefteå municipality has made major investments to accommodate more residents. According to an article in Dagens Nyheter, the municipality’s debt has increased tenfold in a short time.
Northvolt’s extremely rapid expansion plans have not been guided by concern for the climate in the first place. The most important thing driving this has been their desire to quickly create a dominant position in the market. The municipalities in the north have been left in the lurch by both the current and previous governments. The task of managing housing construction and all other investments on their own is overwhelming and the municipalities bear the entire risk.
At the mercy of capitalism, all the ‘green’ industrial ventures become high-risk projects that can quickly crash when profits and markets turn down. The rapid collapse of Northvolt is a warning that highlights the urgent need for struggle and organisation for a socialist transformation of the whole of society.
