Umicore and Volkswagen's PowerCo establish JV for European battery materials production; Joint venture invests €3B and aims to produce battery materials for 2.2M fully electric cars per year year by 2030
Announced today the founding of a joint venture for precursor and cathode material production in Europe. From 2025 onwards, the joint venture will supply PowerCo's European battery cell factories with key materials. The partners aim to produce by the end of the decade cathode materials and their precursors for 160 GWh cell capacity per year, which compares to an annual production capacity capable of powering about 2.2 million full electric vehicles. Cathode active materials are crucial for a successful powertrain transition towards e-mobility as they are the key technological lever for battery performance, as well as the biggest single contributor to overall battery cost.The long-term partnership includes the production of precursor and cathode materials in Europe, which are strategically important input materials central to battery value creation. In addition, Umicore and PowerCo will collaborate on the sustainable and responsible sourcing of raw materials, an area in which Umicore is an industry leader. Finally, Umicore will be providing refining services to PowerCo and both partners aim to include, at a later stage, elements of refining and battery recycling based on Umicore’s technology and know-how into the scope of the JV.
Production at the JV is scheduled to start in 2025 to supply PowerCo’s Salzgitter factory and reaching an annual capacity of 40 GWh in 2026. Both partners target to grow the JV‘s annual production capacity to 160 GWh by the end of the decade, based on market and demand development. The production site search is still ongoing.
Under the terms of the agreement, both partners will jointly control the JV and will equally share costs, investments, revenues and profits. The JV will give both partners a significant first-mover advantage in the fast-growing e-mobility market in Europe. Together they plan to invest about €3 billion into new materials production capacities.