Sustainable lithium supplies secured.
BMW Group, as promised, is securing supplies of key elements (lithium, cobalt) for its lithium-ion cell supplier directly from mining companies.
This week, the German manufacturer announced a €540 deal with Ganfeng Lithium Co., Ltd. based in Jiangxi (China), which will be responsible for lithium hydroxide supply over five years (2020-2024) from its Australian hard-rock deposits.
According to BMW, this single deal is enough to cover all the lithium needs for the upcoming 5th generation battery packs for plug-in electric cars, scheduled for market introduction starting in 2021.
“The projected order volume totals 540 million euros. In this way, the BMW Group is securing 100% of its lithium hydroxide needs for fifth-generation battery cells in its high-voltage batteries,”
The BMW Group intends to expand its lineup to 25 plug-in models by 2023. We guess that sales will then reach a level of several hundred thousand annually (compared to over 145,000 over the past 12-months).
Battery cells for BMW to be supplied by Samsung SDI and Contemporary Amperex Technology Co. Limited (CATL). In total, BMW ordered more than €10 Billion ($11 Billion) worth of cells by 2031.
“Sustainability and security of supply are important factors in the expansion of electromobility. For the BMW Group’s purchasing experts, ethically responsible raw material extraction and processing begins right at the start of the value chain: They are intensively involved throughout our battery cell supply chains – all the way down to the mines themselves. Compliance with environmental standards and respect for human rights have absolute priority. “Sustainability is an important aspect of our corporate strategy and plays a central role in expanding electromobility. We are fully aware of our responsibilities: Lithium and other raw materials must be extracted and processed under ethically responsible conditions,” underlined Wendt. Ganfeng extracts lithium by mining so-called hard-rock deposits in Australia under the strictest sustainability standards.”
“The BMW Group already publishes the countries of origin of the cobalt it uses on its website (see here). For the upcoming fifth generation of battery cells, the company has also restructured its supply chains and will be sourcing both lithium and cobalt directly from 2020, making the raw materials available to the two battery cell manufacturers, CATL and Samsung SDI. This ensures full transparency over where raw materials come from. Cobalt will be sourced directly from mines in Australia and Morocco in the future. Supply contracts will ensure the company’s security of supply up to 2025 and beyond.”
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