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BMW buys lithium for half a billion euros in China

2019-12-11T16:16:56.843Z


BMW secures supplies for batteries of its electric cars. The group reached an agreement with the Chinese company Ganfeng Lithium on the purchase of the alkali metal. Demand in Germany is rising.



The supplier is mining the raw material in Australia: BMW has agreed to purchase lithium worth 540 million euros by 2024 from a Chinese company. "By signing the contract, we are securing our lithium demand for battery cells," said purchasing director Andreas Wendt about the contract with Ganfeng Lithium.

In addition to cobalt, lithium is one of the most important components of battery cells that BMW manufactures from the suppliers CATL and Samsung SDI and then installs itself in the batteries. For the upcoming fifth generation of battery cells, BMW will buy Cobalt itself from 2020 and will supply the raw materials to the battery cell manufacturers. Cobalt will be sourced from Morocco besides mines in Australia.

Security of supply until 2025

The lithium contract runs until the end of 2024. "We want to offer 25 electrified models as early as 2023, more than half of which will be fully electric, which will increase demand for raw materials," said Wendt. The supply contracts guaranteed supply security until 2025, BMW said.

Access to lithium is not only critical when transitioning to electric drives. Lithium-ion batteries are also used as energy storage in smartphones or cordless screwdrivers. The Federal Government was similarly irritated when a German company was again denied access to the important raw material in Bolivia.

In 2018 alone, 202 million lithium-ion batteries worth 2.4 billion euros had been imported into Germany, according to the Federal Statistical Office. And the trend is on the rise: by the end of September, 190 million lithium-ion batteries had already been imported. About 40 percent came from China, once again so much came from Japan, South Korea and Singapore.

BMW uses the cells of the two Asian manufacturers to build the batteries for its electric cars, even in the Dingolfing, Spartanburg and Shenyang factories. By 2031, BMW has ordered battery cells for CATL for 7.3 billion euros and Samsung SDI for 2.9 billion euros. "This will secure our long-term demand for battery cells," said Wendt. In Europe, the Munich 2025 want to sell every third car with electric or hybrid drive.

Source: spiegel

All business articles on 2019-12-11

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