Volkswagen will explore opportunities across automotive and battery supply chain, through its new battery company PowerCo, while Mercedes-Benz will explore a strategic partnership with Canada-based Rock Tech Lithium


Volkswagen CEO Diess and Canadian minister Champagne, German Federal Chancellor Scholz and Canadas Prime Minister Trudeau. (Credit: Volkswagen AG)

German automobile manufacturers Volkswagen and Mercedes-Benz have signed Memorandum of Understanding (MoU)s with Canada, focused on battery materials cooperation for e-mobility.

Under the terms of the MoU, Volkswagen will explore opportunities across automotive and battery supply chain in Canada, through its newly founded battery company, PowerCo.

It aims to build six large-scale battery cell factories in Europe by 2030 with a capacity of around 240GWh, along with a dedicated factory in North America.

Mercedes-Benz intends to explore a strategic partnership with Canada-based lithium development company Rock Tech Lithium.

Under the partnership, Rock Tech Lithium would supply the German automobile company and its battery partners with up to 10,000 tonnes of lithium hydroxide per annum, from 2026.

Volkswagen Group CEO Herbert Diess said: “Volkswagen has been vigorously pushing the transformation to e-mobility, recognizing the industry’s responsibility in the global battle against climate change.

“Working hand in hand with governments around the world is an absolute prerequisite to meet our climate goals and I want to thank the Canadian government for their support.

“The supply of battery raw materials and the production of precursor and cathode materials with a low carbon footprint will allow for a fast and sustainable ramp-up of battery capacity — a key lever for our growth strategy in North America.”

Volkswagen said that the partnership will boost cooperation between its PowerCo and the Canadian mining sector, for the development of sustainable battery production.

PowerCo is preparing to open a new liaison office in Canada, focused on supply of critical raw materials such as lithium, nickel and cobalt.

The company, together with partners, will ramp up cathode material production and enable Canadian suppliers to serve as raw material suppliers, refiners and processors.

Furthermore, Volkswagen said that Canada is well-positioned for joint projects, with large raw material resources, infrastructure and highly developed automotive industry.

Volkswagen Group board of management member Thomas Schmall said: “The Government of Canada is a forward-thinking, effective enabler of businesses creating future-proof, well-paying jobs for Canadians, particularly in the green economy.

“This is one reason why Volkswagen and PowerCo are excited to work with such an approachable partner offering promising cooperation and engagement at all levels of government.”