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Volkswagen Group: three new partnerships for battery production

3.1.2022
Volkswagen Group: three new partnerships for battery production

Volkswagen Group is strengthening its lithium-ion cells and battery technology know-how with three new strategic partnerships that will play an important role in the industrialisation process.

The battery is the heart of every 100% electric vehicle, which is why Volkswagen Group has established a specific roadmap to strengthen its know-how and position in this area, which is also reflected in the three new strategic partnerships announced in recent weeks. The new partners are Umicore, a leading materials technology group, battery specialist 24M Technologies and Vulcan Energy Resources Ltd, a cleantech company. These three partnerships are independent of each other but share a common goal: the industrialisation of increasingly innovative technologies and the volume production of even more sustainable batteries.

In parallel, the Volkswagen Group continues to make progress in the development and in-house production of battery cells, as presented at its Power Day in March 2021. In Europe alone, six gigafactories dedicated to batteries will be built by 2030.

The battery cells of the future

We are implementing our battery strategy very consistently and at a high pace. The unified cell that will be used throughout the Volkswagen Group must be at the forefront of performance, cost and sustainability right from the start, and with our new partners are one step closer to reaching that goal. Together, we will focus on the key parts of the battery value chain and develop cutting-edge technologies”, said Thomas Schmall, Member of the Board of Management of the Volkswagen Group and CEO of Volkswagen Group Components.

Partnership with Umicore

Volkswagen AG and Umicore plan to establish a joint venture for the supply of cathode materials for the Group’s European plants where the cells will be produced - a further step towards vertical integration of the supply chain. The intention is to gradually increase the joint venture's production capacity, starting in 2025 with the Salzgitter gigafactory, for which an initial capacity of 20 GWh per year is planned. The ultimate goal is to reach an annual production capacity of up to 160 GWh by 2030 - enough to power around 2.2 million 100% electric vehicles.

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Thomas Schmall (foreground left) and Mathias Miedreich (foreground right); Frank Blome, Jörg Teichmann (Volkswagen), and Ralph Kiessling (Umicore).

Sustainable raw materials for Europe

To achieve these goals, it is essential to have a long-term partnership that includes the sharing of investments and having a framework to develop next-generation technologies, as well as optimising costs and production processes. Another important aspect will be to build production capacity for both cathode materials and precursors, and to secure the availability of ethically sourced, sustainable and competitively priced raw materials.

At a later stage, Volkswagen AG and Umicore will consider integrating further activities related to cell recycling and refining into the scope of the joint venture at a later stage. The aim is to create a European supply chain for batteries, sending a clear signal.

The complementarity of our extensive technology, innovation and industrial know-how will provide a strong framework to develop next-generation battery technologies, giving us a considerable first-mover advantage in this fast-growing market”, says Mathias Miedreich, CEO of Umicore.

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Mathias Miedreich (left), Thomas Schmall; Frank Blome, Jörg Teichmann (Volkswagen), and Ralph Kiessling (Umicore)

24M Technologies, new battery technologies

The aim of Volkswagen AG's partnership with 24M Technologies - a US start-up company founded as a spin-off from the Massachusetts Institute of Technology (MIT) - is to industrialize the 24M technology, a semi-solid process for making batteries, an improvement over the dry coating process. This will make it possible to optimise battery production costs by reducing material usage and eliminating several steps from the conventional production process. For this purpose, a new subsidiary of the Volkswagen Group will further develop and upscale the technology for automotive applications created by 24M Technologies.

The collaboration with the Volkswagen Group significantly expands our ecosystem. Their investment, collaborative development and ability to scale globally will accelerate our manufacturing platform. Our mission is to develop a better and cleaner energy future”, adds 24M President and CEO Naoki Ota. Prospective benefits include up to 40% reduction in production area, significant investment savings and more efficient recycling, as well as a reduction in the carbon footprint of battery production. The process is targeted for implementation in mass production in the second half of the decade.

Carbon neutral lithium thanks to Vulcan Energy Resources Ltd

Vulcan Energy Resources Ltd will supply the Volkswagen Group with carbon neutral lithium - produced from local geothermal brine - from the Rhine Valley in Germany. The contract will provide lithium hydroxide for five years starting in 2026. With this agreement, the Volkswagen Group will be able to secure the necessary coverage for the in-house production of battery cells in Germany and more generally in Europe.

Vulcan Energy will support the Volkswagen Group in becoming a global leader in the production of carbon neutral electric vehicles including all raw materials in the battery supply chain”, explains Vulcan Energy CEO Francis Wedin. Vulcan is developing the Zero Carbon Lithium project, to establish a sustainable and local source of lithium from Europe's largest lithium deposit, with a production process that does not require fossil fuels or evaporation ponds.

Completion of all three agreements is subject to customary closing conditions.

SourceVolkswagen Newsroom

VGI | Responsible OU: VP | Creation date: article date | Class 9.1

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