Plans for a SEK 13 billion large battery anode factory in Timrå, north of Sundsvall, have been entirely scrapped, according to Dagens Industri.
The China-owned company Shanghai Putailai (PTL) was expected to employ 1,900 people. Swedish battery manufacturer Northvolt was among the potential customers.
However, just before Christmas, Sweden’s Inspectorate of Strategic Products (ISP) rejected PTL’s application unless the company accepted certain conditions. PTL has now announced that the project will not go ahead.
“The business conditions for the investment are unfortunately no longer in place,” says Dr. Yu Han, PTL’s chief representative in Europe, in a press release.
The project, initially announced in May 2023, aimed to establish a 100,000-ton annual capacity anode materials plant through PTL’s subsidiary, Zichen Technology Sweden AB. The facility was intended to strengthen PTL’s position in the European battery supply chain, with the first phase targeting 50,000 tons of capacity by 2025.
In December 2024, the Swedish government proposed conditions related to Zichen Sweden’s ownership, management structure, intellectual property rights, and regulatory arrangements. PTL found these requirements commercially unfeasible and proposed alternative arrangements, but the government rejected them.
PTL expressed dissatisfaction with the Swedish stance, describing the control-related demands as “unreasonable” and contrary to global trade norms. The company is exploring legal avenues to appeal the decision and remains in communication with Swedish authorities to assess alternative pathways for this project.
This development underscores the challenges Chinese investors face in navigating increasingly stringent national security and investment screening policies across Europe. PTL’s halted project highlights the growing tension between Europe’s desire to reduce reliance on Chinese supply chains and the practical need for Chinese expertise and capacity in the battery materials sector.
Despite this setback, PTL remains committed to its overseas ambitions and is reportedly evaluating alternative investment destinations to support its global growth strategy.
