Sweden's beleaguered electric car battery maker Northvolt said Monday it would cut a quarter of its staff in the country, as it struggles with strained finances and a slowdown in demand.

The loss of 1,600 jobs in Sweden comes as electric car sales slump in Europe and the continent lags far behind China in battery production.

"While overall momentum for electrification remains strong, we need to make sure that we take the right actions at the right time in response to headwinds in the automotive market, and wider industrial climate," Northvolt CEO Peter Carlsson said in a statement.

He added that Northvolt needed to "focus all energy and investments into our core business."

Northvolt, which warned on September 9 that cuts were coming, said that following "initial steps" of a strategic review it estimated that proposed cost-saving measures would result in about 1,000 redundancies at its primary Skelleftea plant—where an expansion project would be suspended.

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