The rapid increase in electrification in the automotive industry will have a major impact on global raw material markets. The global lithium demand is expected to be more than double by 2023, and Volkswagen wants to be prepared.
VW Group and China’s Ganfeng Lithium have signed a Memorandum of Understanding on long-term lithium supplies for battery cells. Under the agreement, Ganfeng will supply lithium to VW and its suppliers for the next 10 years.
According to Stefan Sommer, Group Board Member for Components and Procurement at Volkswagen, “Over the next ten years the Volkswagen Group will be launching 70-plus new pure electric vehicles. That means approximately a quarter of the vehicles we deliver in 2025 will be powered by electricity. Consequently, there will be a rapid increase in our raw material demand for cell production in the coming years. We must make sure we cover this demand at an early stage. Long-term agreements like the one for lithium, a key raw material, that we have just concluded with Ganfeng are therefore of crucial strategic significance for implementing our electric offensive.”
In addition to the arrangements on lithium supplies, Volkswagen and Ganfeng also agreed to cooperate on future topics such as battery recycling and solid-state batteries.