As the world is switching toward electric vehicles, the battery is one of the vehicle’s most important components. In meeting this vital particle, today, the battery company of the Volkswagen Group, PowerCo, and the Belgian circular materials technology group, Umicore, have officially announced the founding of a joint venture for precursor and cathode battery material production in Europe.
PowerCo-Umicore Partnership To Produce 2.2million Battery Materials for EVs Yearly
The joint venture will be supplying essential components to PowerCo’s European battery cell plants beginning in 2025. According to the firms, the partnership tends to be able to create enough cathode material and its precursors annually to power around 2.2 million fully electric vehicles, or 160 GWh, of cell capacity by the end of the decade.
Cathode-active materials are essential for a successful powertrain transition to e-mobility since they are both the single largest factor in overall battery cost and the major technological lever for battery performance. The long-term relationship is focused on the manufacture of cathode and precursor materials in Europe, which are strategically significant inputs essential to creating battery value.
Additionally, Umicore and PowerCo will cooperate on the ethical and sustainable sourcing of raw materials, an area in which Umicore is a leader in the industry, under the terms of further agreements. Umicore will also offer PowerCo refining services in this context. Both partners intend to eventually incorporate parts of refining and battery recycling into the scope of the JV based on Umicore’s technology and expertise.
How Important is Cathode Material To Battery Production
Speaking on the partnership, Thomas Schmall, Group Board Member for Technology at Volkswagen AG and Chairman of the Supervisory Board of PowerCo SE, said Cathode material, which makes up around 50% of the value of a cell overall, is a crucial strategic resource for the production of batteries.
In his words: “Cathode material is an indispensable strategic resource for battery production, accounting for roughly fifty per cent of the overall cell value. Immediate and long-term access to extensive capacity is thus a very clear competitive advantage. We are setting up a sustainable, transparent supply chain with high environmental and social standards, localizing value creation here in Europe.”
Umicore To Establish Sustainable Industrial-scale Through The Partnership
However, on the other hand, Umicore CEO, Mathias Miedreich noted that the firm tends to establish sustainable industrial-scale, closed-loop battery materials value chains in key regions with the partnership.
“This partnership is a strong signal of recognition of our product and process expertise and a testament to the success of our strategy to establish sustainable industrial-scale, closed-loop battery materials value chains in key regions,” said Mathias Miedreich. “We are supporting our customers on their path to electrification right from the start, and are very pleased to partner with PowerCo and support Volkswagen in their fast transformation towards sustainable electric mobility.”
Meanwhile, PowerCo CEO, Frank Blome added that the signing of the partnership shows the company’s rapidly growing demand for battery-grade materials for their customers Volkswagen AG in terms of volume and at optimal cost.
“The availability, cost and technical performance of battery cells are key requirements for the successful ramp-up of e-mobility. By building up substantial production capacities, we are securing the rapidly growing demand for battery-grade materials for our main customer Volkswagen AG in terms of volume and at optimal cost.”