The German car giant Volkswagen announced on Monday an agreement with Chinese partners for the creation of two joint ventures to strengthen its position in electric batteries.
China, the world’s largest automobile market, is at the forefront of the race for “green” cars, thanks to an incentive policy from Beijing in the electric sector.
Volkswagen, which has seen its electric sales in China more than quadruple in one year, plans to sell 1.5 million new energy vehicles there by 2025.
To strengthen its position in this niche and secure its supply of batteries, the group will create two joint ventures with the Chinese Huayou Colbalt and Tsingshan group, Volkswagen said in a statement on Monday.
“The two partnerships should ultimately allow […] to reduce the cost of each battery by 30 to 50%”, specified the firm whose head office is in Wolfsburg (Germany).
Huayou is a lithium-ion battery materials specialist, while Tsingshan is a nickel and stainless steel giant.
Volkswagen’s first joint venture will be established in Indonesia jointly with these two companies. It will be used to produce nickel and cobalt, two metals essential for batteries.
The second joint venture, formed only with Huayou, will specialize in refining these raw materials, Volkswagen said.
In 2020, the German giant had already announced in China a massive investment of more than 2 billion euros, half and half in a vehicle company and in a local battery manufacturer, Gotion High-Tech.
A year earlier, the German group had announced an agreement with another Chinese group, Ganfeng, to supply itself over ten years with lithium, a fundamental component for electric car batteries.
Manufacturers in China are vying to establish themselves on the electric market, with the backing of purchase subsidies.
However, this aid has been reduced by 30% since January 1 and will disappear entirely on December 31, 2022.
This article has been published automatically. Sources: ats / awp / afp
