Volvo deal with major Chinese battery producer

Volvo Car Group has signed a long-term agreement with Chinese battery producer Contemporary Amperex Technology (CATL) to ensure a multi-billion-dollar supply of lithium-ion batteries for its next generation vehicles over the coming decade.

The agreement covers the global supply of battery modules for all models on the upcoming SPA2 and the existing CMA modular vehicle platforms. This deal comes as e-car production is increasing while battery recycling is lagging behind, putting further strain on the availability of precious metals. Interestingly, Berenberg Research has reported worldwide metals recovery from spent car batteries could be worth around US$ 20 billion a year by 2030.

In line with Volvo’s sustainable development strategy, CATL will use clean energy for battery production, tracking and managing raw material supply. The batteries in question will come from CATL’s overseas facilities.

CATL was founded in Ningde, China, in 2011 and currently employs almost 24 000 people worldwide. Besides producing batteries, it also focuses on battery recycling and reuse. For example, CATL e-mobility batteries can be used for energy storage purposes.

Meanwhile, Tesla recently announced it is opening an e-car battery recycling plant in the US state of Nevada. The site, dubbed the Gigafactory, is expected to recover recycled metals such as lithium, aluminium, copper and steel to create new batteries.