NOVONIX Shares Fall 11% After Stellantis Terminates Offtake Agreement

Market Reprices NOVONIX Following Termination of Stellantis Offtake Agreement

NOVONIX (ASX: NVX; NASDAQ: NVX) announced that its offtake agreement with FCA US LLC, a subsidiary of Stellantis NV, has been terminated effective immediately. The news triggered an 11 percent drop in the share price as investors digested the implications of losing one of the company’s most anticipated commercial contracts. The decision followed an inability by both parties to finalise product specifications and production milestones required for large-scale qualification, highlighting the technical challenges that can emerge in the early phases of industrial battery supply.

The original agreement, signed in November 2024, covered a minimum of 86,000 tonnes and up to 115,000 tonnes of synthetic graphite over six years, with first commercial supply scheduled for January 2026. For NOVONIX, this was more than a sales contract; it was a cornerstone validation of its high-performance battery materials technology and a key anchor for its growing customer pipeline.

The market’s sharp reaction reflects how much confidence had been built around this partnership as a sign of commercial readiness. Losing Stellantis may delay near-term revenue visibility, but it does not erase the broader opportunity. NOVONIX remains positioned at the forefront of North America’s effort to build a domestic supply chain for synthetic graphite, with production capacity expanding and partnerships with Panasonic and PowerCo already in place. The real test now will be management’s ability to replace the Stellantis volume with new offtake agreements that reaffirm its role in the US electrification ecosystem.

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Stellantis Exit Highlights Technical Growing Pains for NOVONIX

According to NOVONIX, the termination of the Stellantis agreement came down to a lack of alignment on the technical specifications required for the automaker’s next-generation battery cells. This suggests the issue was primarily technological rather than financial or operational. Stellantis may have been seeking performance benchmarks that NOVONIX’s current graphite materials could not yet meet within the agreed timeframe, highlighting the challenges of scaling cutting-edge battery technology to commercial production.

While the outcome was disappointing, NOVONIX reaffirmed its focus on existing partnerships with Panasonic and PowerCo, as well as ongoing graphite sample deliveries to 15 current and potential customers. These relationships remain central to the company’s strategy of positioning itself as a leading supplier of synthetic graphite within the US battery supply chain.

Given that the Stellantis partnership was expected to begin generating commercial supply from January 2026, the 11 percent share price decline reflects a loss of near-term confidence in NOVONIX’s ability to meet key milestones and convert its pipeline into secured revenue. For many investors, the Stellantis deal represented early commercial validation of NOVONIX’s synthetic graphite technology and a cornerstone customer for its upcoming US production facilities.

The Investors’ Takeaway for NVX

For investors, this should be seen as a short-term setback rather than a structural failure that leaves the business impaired. NOVONIX remains engaged in discussions with both existing and new customers, and its long-term prospects are supported by substantial funding commitments and potential backing from US federal programs aimed at strengthening domestic battery manufacturing.