NKT has announced plans to build a new factory including a third extrusion tower in Karlskrona, Sweden, and a new market-leading power cable vessel. The investments are driven by a increasing demand for high-voltage power cables, strong order intake and a record order backlog of more than EUR 7bn at the end of Q1 2023.
Since March 2023, NKT has confirmed high-voltage contract awards and booking commitments of more than EUR 5bn. To deliver on this significant order intake, prepare for the continued strong market outlook and execute the record high order backlog, NKT will invest around EUR 1bn in its high-voltage power cable business.
The investments include a new, market-leading vessel with record-high power cable-laying capacity compared to vessels in the existing world fleet and a significant extension of the Swedish production site in Karlskrona. Here, NKT will build a new factory including a third 200m extrusion tower adding end-to-end production capacity next to the existing facility. This will turn the site into the world’s largest high-voltage offshore cable production site.
NKT President and CEO Claes Westerlind says: “The order awards and commitments from our customers in recent months highlight our leading position within turnkey solutions, XLPE and high-voltage DC technology. Power cables are key enablers of the transition to renewable energy and current high-voltage production and installation capacity is not sufficient to meet the increasing demand in the market. We are excited to continue growing NKT in line with our strategic ambitions and to continue developing our turnkey power cable offerings to our customers.”
The investments will expectedly amount to around EUR 1bn from 2023 to 2026 and will strengthen NKT’s market leading position significantly by improving the company’s abilities to meet the growing demand for especially long-length HVDC power cable solutions. The new assets will be operational from 2027.
In 2020, NKT initiated an investment program in its high-voltage factories driven by a record-high order backlog including awards of the German corridor projects and a positive market outlook. A key part of the program was to add a second extrusion tower to the Swedish factory in Karlskrona which has been completed. Additional investments were announced in 2022 following the continued positive market development.
Driven by the previous investment program, more than 300 new employees have joined the Karlskrona factory since 2020. Now, NKT expects to welcome more than 500 new employees at the Swedish site towards 2027 following the investments.