Press release – Parliament backs €8.5 million in EU aid for dismissed workers in Sweden

With 578 votes in favour, 54 against and 30 abstentions, Parliament approved the release of €8.5 million from the European Globalisation Adjustment Fund for Displaced Workers (EGF) to support employees dismissed following the bankruptcy of electric-vehicle battery manufacturer Northvolt AB in March 2025. The Swedish company specialised in battery manufacturing for electric vehicles to reduce European dependence on Chinese manufacturers. Northvolt faced significant operational challenges that impacted production capacity, while intense global price competition driven by state-subsidised manufacturers, particularly in China, led to order cancellations and market oversupply, ultimately undermining the company’s position.

The EU is set to cover 60% (€8.5 million) of the estimated €14.2 million cost of the assistance through the EGF fund, while Swedish authorities contribute the remaining €5.7 million. The measure will assist approximately 5,800 workers in re-entering the labour market through personalised career guidance, coaching, allowances, educational training and assistance for starting a business.

Background

The EGF aims to demonstrate solidarity by supporting dismissed workers and self-employed individuals who lose their employment due to major, unexpected restructuring events provoked by shifts in world trade patterns, globalisation, or global economic crises. Under the 2021-2027 EGF regulation, member states can request EU funding when at least 200 workers are made redundant within a specific reference period. If an application meets the EGF criteria, the Commission proposes mobilising the funds, which must then be approved by both Parliament and the Council. According to the Commission, the EGF has been used in 185 cases since 2007, allocating €719 million to provide help to more than 175,000 people across 20 EU countries.