Mercedes-Benz Signs MoU With the Government of Canada to Source the Raw Materials for Electric Vehicle Batteries

author: Eric Walz   

Mercedes-Benz plans to become an electric-only automaker by 2030, which is an ambitious goal. A key part of reaching this goal is to secure enough raw materials, such as lithium, for the production of millions of electric vehicle batteries. 

As part of its efforts to set up an entire automotive value chain for the sustainable production of EV batteries, Mercedes-Benz has signed an MoU with the Canadian Government that will help ensure that the automaker has a reliable supply for raw materials to produce all of the batteries its will need by the end of the decade.

"Canada is quickly becoming the green supplier of choice for major auto companies, including leading European manufacturers, as we transition to a cleaner, greener future," said  François-Philippe Champagne, Canada's Minister of Innovation, Science and Industry. "By partnering with Mercedes-Benz, Canada is strengthening its leadership role as a world class automotive innovation ecosystem for clean transportation solutions."

The purpose of the MoU is to promote cooperation and to explore ways to advance opportunities across Canada's electric vehicle supply chain, including securing sustainable sources of raw materials. These raw materials for EV batteries include cobalt, lithium, nickel, graphite, manganese and copper.

As part of the MoU with the Government of Canada, Mercedes-Benz is exploring a strategic partnership with Ontario-based Rock Tech Lithium Inc. to supply its vendors with lithium hydroxide to meet global demand for electric vehicles. The lithium will be processed in Germany as part of the automaker's goal to localize production of state-of-the art battery cells in Europe.

"To scale up mass production of electric vehicles we need access to raw materials," said Gunnar Guethenke, Vice President Procurement and Supplier Quality of Mercedes-Benz AG. "With the intended Rock Tech-partnership we are diversifying the sourcing of our raw materials as part of a direct sourcing approach to secure the lithium supply for Mercedes-Benz battery production in Europe." 

The lithium hydroxide mined in Canada will be refined in a CO2 neutral manner in Brandenburg, Germany. Rock Tech is currently building Europe's first lithium hydroxide converter with a planned investment of several hundred million Euros. 

Mercedes says that battery production presents the automaker's biggest opportunity for reducing CO2. 

Rock Tech is aiming for a production capacity of 24,000 tonnes of lithium hydroxide a year by 2024, which is enough to produce around 500,000 electric cars equipped with lithium-ion batteries. Starting in 2026, Rock Tech intends to supply Mercedes-Benz and its battery partners with up to 10,000 tonnes of lithium hydroxide annually.

The lithium will be offered from mining sites audited to the standards of the "Initiative for Responsible Mining Assurance" (IRMA) and processed with renewable energy sources. The IRMA certifies social and environmental performance at mine sites globally using an internationally recognized standard. Responsibly mined and processed raw materials for batteries will serve as the foundation for Mercedes-Benz's transition to building electric-only vehicles by 2030.

"Mercedes-Benz is looking to open new ways to responsibly acquire raw materials to rapidly scale up electric vehicle production. Securing direct access to new primary and sustainable sources of raw materials is a vital step down this road," said Markus Schaefer, Member of the Board of Management of Mercedes-Benz Group AG, Chief Technology Officer responsible for Research & Development and Procurement.  "With Canada, Mercedes-Benz has a strong and capable partner to break new ground for a new era of sustainable transformation in the automotive industry."

The signing of the MoU with the Canadian Government aligns with Mercedes-Benz's "Ambition2039" with a focus on the reduction of CO2 emissions as well as the responsible use of resources along the entire supply chain. These efforts include a significant reduction in the amount of rare earth metals used in the batteries that will power future Mercedes-Benz EVs.

Mercedes-Benz is well underway in its transformation to an electric-only automaker. In April, Mercedes-Benz unveiled its highly-anticipated, electric EQS sport utility vehicle. The sleek battery powered SUV will be built in the U.S. at the automaker's assembly plant in Tuscaloosa, Alabama. The EQS SUV goes on sale this fall. 

The EQS SUV is the third fully-electric vehicle under the EQ sub brand of Mercedes-Benz following the launch of the battery-powered EQS sedan and EQE sedan. The electric SUV is built on the same platform as the EQS and EQE. The EQS SUV will also be launched in Europe by the end of the year.

Mercedes-Benz is accelerating the roll-out of its EQ family of fully-electric models and plans to have nine EQ models on sale globally by the end of the year. 

With so many new electric models in the works, The responsible sourcing of raw materials, such as lithium, will remain an important focus for Mercedes-Benz as it works towards its goal of becoming a carbon neutral company by 2039.

Eric Walz

Originally hailing from New Jersey, Eric is a automotive & technology reporter covering the high-tech industry here in Silicon Valley. He has over 15 years of automotive experience and a bachelors degree in computer science. These skills, combined with technical writing and news reporting, allows him to fully understand and identify new and innovative technologies in the auto industry and beyond. He has worked at Uber on self-driving cars and as a technical writer, helping people to understand and work with technology.