What happened
Freyr Battery (FREY 5.70%) stock jumped Wednesday morning and surged to a high of 12.7% after the lithium-ion battery manufacturer hit a milestone at a plant that takes it one step closer to the commercial production of battery cells.
So what
Freyr is currently designing and testing batteries primarily for energy storage and transportation markets, including the electric vehicle market. It is in the final stages of constructing its customer qualification plant (CQP) in Norway, which will eventually produce samples for early customer testing. Freyr is also constructing a gigafactory in Norway called the Giga Arctic, which is expected to start battery production only after the successful start-up of the CQP battery cell production and testing line.
This morning, Freyr announced that it had successfully demonstrated automated casting with solvent slurry to the representatives of Nidec, a Japanese manufacturer of electric motors. This was one of the three important milestones that Freyr must reach before commencing production at CQP.
Now what
Freyr expects to hit the remaining two milestones on time and start fully automated production at CQP by the fourth quarter of this year. Freyr can then produce and ship sample battery cells to customers like Nidec and eventually start commercial production at its gigafactory per customers' demand.
Nidec, for example, has a binding purchase agreement with Freyr to use its battery cells in modules for energy storage systems and is now also looking to extend its partnership with the battery maker. Freyr also has some nonbinding offtake agreements with other energy storage companies.
