Mercedes-Benz Group and Volkswagen Group on Tuesday signed offers with the Canadian authorities to safe entry to Canada’s giant shops of key battery supplies reminiscent of lithium, cobalt, nickel and graphite, because the German firms compete for scarce provides of uncooked supplies with different automakers shifting to electrical autos.
Markus Schaefer, chief expertise officer at Mercedes-Benz, and outgoing Volkswagen CEO Herbert Diess every signed a memorandum of understanding with François-Philippe Champagne, federal Minister of innovation, science and trade, in Toronto Tuesday morning.
The signing of the pair of battery worth chain collaboration agreements adopted feedback from Canadian Prime Minister Justin Trudeau and German Chancellor Olaf Scholz in regards to the want for higher Canadian-German collaboration as world unrest roils conventional provide chains.
“What we’re experiencing proper now is an ideal storm — a mess of overlapping and mutually reinforcing world crises,” Scholz stated on the occasion hosted by the Canadian-German Chamber of Trade and Commerce. He pointed particularly to Russia’s invasion of Ukraine and its ripple results on the power and useful resource sectors.
Scholz, who’s halfway by way of a three-day go to to Canada accompanied by quite a few German enterprise leaders, stated Canada has “virtually boundless potential to grow to be a superpower” in sustainable useful resource manufacturing. Germany is intent to grow to be one among Canada’s closest companions, he added, and the brand new offers with Mercedes-Benz and Volkswagen present the “alternatives are there.”
The MOU between Canada and the pair of automakers lack agency commitments from both set of events, focusing as an alternative on additional “exploring” the alternatives in Canada’s uncooked supplies and processing sectors.
However, Champagne stated the agreements “cement” the curiosity of the German automakers in Canada, enhance the battery ecosystem in Canada and put together the nation for investments.
“What you noticed in the present day is a totally new chapter even for the automotive trade in Canada as a result of now we have now the German automakers. We weren’t even on their radar display screen, now we’re centre of their radar, and I believe that’s going to result in us partnering with them in a strategic approach.”
Schaefer stated the collaboration with Canada is a “nice match” as the corporate quickly ramps up battery manufacturing and sees its necessities for important minerals balloon.
Mercedes-Benz can be on the cusp of firming up an settlement with a Canadian mining agency that can construct off the cope with Ottawa, Schaefer added. The automaker disclosed it’s at the moment finalizing an settlement with Vancouver-based lithium miner Rock Lake Lithium, which is creating a mine in Ontario. The deal will see Rock Lake provide Mercedes-Benz’s European operations with as much as 10,000 tons of lithium hydroxide yearly beginning in 2026.
Schaefer additionally left the door open for Canadian investments in battery materials processing.
“We’d prefer to refine right here as effectively. The query is, what are you able to do in a restricted period of time? The capital even wanted for exploration and all the opposite actions wanted are big … so I believe we have now to divide somewhat bit the work that has been completed.
“As soon as [refining] is feasible and doable, then we are going to enter into it.”
Volkswagen, likewise, stated the MOU with the Canadian authorities will assist advance its battery provide chain in North America and past.
The deal is designed to forge nearer ties between the Canadian mining sector and PowerCo, the VW entity taking the lead on the automaker’s battery provide chain enterprise.
Diess, who’s departing as VW CEO efficient Sept. 1, stated working hand in hand with authorities is an “absolute prerequisite” as Volkswagen rolls out electrical fashions and works towards its local weather objectives.
“The availability of battery uncooked supplies and the manufacturing of precursor and cathode supplies with a low carbon footprint will permit for a quick and sustainable ramp- up of battery capability — a key lever for our progress technique in North America,” he stated in a launch.
Volkswagen stated it sees “important prospects” to ramp up cathode materials manufacturing alongside its companions, counting on Canadian suppliers to “act as uncooked materials suppliers, refiners and processors.” The corporate stated it has plans to construct a devoted battery cell plant in North America and is at the moment analyzing places.