STOCKHOLM: Swedish lithium-ion battery maker Northvolt said on Monday it had received an order worth more than $14 billion over 10 years from Germany's Volkswagen .

The battery maker also said it will sell its share in joint-venture Northvolt Zwei to Volkswagen, while the carmaker increases its ownership in Northvolt.

"By consolidating cell production to the Northvolt Ett gigafactory, the partners will achieve further economies of scale, thereby securing the best possible cost and enabling the lowest environmental footprint in the world for cell production," Northvolt said in a statement.

The Swedish company, which aims to take on major Asian players such as CATL and LG Chem and targets a 25% market share in Europe by 2030, added that it had currently secured over $27 billion worth of contracts from key customers.

Battery makers across the world are seeking to keep up with demand as carmakers increasingly go electric. Investors have been rushing into the EV sector by pushing up valuations for companies such as Tesla and Lucid Motors.

Northvolt said last week it had bought US startup Cuberg to get access to technology that would boost the range of electric vehicles that can use its batteries.

The firm, founded in 2016 by former Tesla executive Peter Carlsson, last raised $600 million from the likes of Volkswagen, Baillie Gifford and Goldman Sachs.