German auto giants Mercedes-Benz and Volkswagen have agreed with Canadian government to explore ways to secure access to key EV battery materials lithium, nickel and cobalt.
The carmakers have signed a memorandum of understanding with the Canadian government to explore deeper cooperation across all stages of the automotive value chain – from technical development and the extraction of raw materials, to production, service life and recycling.
No financial details were disclosed for the memorandum of understanding (MoU) agreements, which were signed in Canada during a visit by German Chancellor Olaf Scholz and a delegation of German corporate representatives.
As a part of a MoU, Mercedes-Benz will explore a strategic partnership with Rock Tech Lithium Inc., which could allow the brand with the three-pointed star to supply its vendors with lithium hydroxide to meet global demand for battery electric vehicles. From 2026 onwards, as part of this envisaged partnership, Rock Tech intends to supply Mercedes-Benz and its battery partners with up to 10,000 tonnes of lithium hydroxide annually, starting with a qualification period.
Volkswagen says it plans to build a “dedicated Gigafactory” somewhere in North America, and today’s agreement most likely increases Canada’s chances of being selected as the location. For the development of sustainable battery production, both parties intend to boost cooperation based on recognized ESG (Environment, Social, Governance) criteria between PowerCo, the newly founded battery company of the Volkswagen Group, and the Canadian mining sector, which is seen as a world leader in terms of responsibility and transparency. For this purpose PowerCo is planning to establish a new, dedicated liaison office in Canada. A key focus of cooperation is the supply of critical raw materials such as lithium, nickel and cobalt.
“Volkswagen has been vigorously pushing the transformation to e-mobility, recognizing the industry‘s responsibility in the global battle against climate change. The Group today not only offers the broadest range of electric models to customers but is also rolling out an ambitious battery and charging strategy. Working hand in hand with governments around the world is an absolute prerequisite to meet our climate goals and I want to thank the Canadian government for their support. The supply of battery raw materials and the production of precursor and cathode materials with a low carbon footprint will allow for a fast and sustainable ramp-up of battery capacity — a key lever for our growth strategy in North America,“ outgoing Volkswagen Chief Executive Herbert Diess said.
“Mercedes-Benz is looking to open new ways to responsibly acquire raw materials to rapidly scale up electric vehicle production. Securing direct access to new primary and sustainable sources of raw materials is a vital step down this road. With Canada, Mercedes-Benz has a strong and capable partner to break new ground for a new era of sustainable transformation in the automotive industry,” said Markus Schaefer, Member of the Board of Management of Mercedes-Benz Group AG, Chief Technology Officer, responsible for Research & Development and Procurement.