Volkswagen and Patriot's Bid to Supply EV Batteries

The Volkswagen Group and its battery subsidiary, PowerCo SE, have taken a significant step toward securing a sustainable lithium supply by partnering with Canadian lithium company Patriot Battery Metals (PBM).

The collaboration represents Volkswagen's first direct investment in the lithium supply chain and solidifies its commitment to creating a robust EV battery ecosystem in North America.

Strategic investment to strengthen the lithium supply

Volkswagen has invested US$48m to acquire a 9.9% stake in Patriot Battery Metals, underlining the automaker's ambition to vertically integrate its battery supply chain—from raw materials to cell production. Accompanying the investment is a binding offtake agreement, securing the supply of 100,000 tonnes of spodumene concentrate per year over the next decade.

The concentrate, sourced from Patriot's Shaakichiuwaanaan Project in Quebec, will support PowerCo's battery production facilities in Europe and North America, including its gigafactory in St. Thomas, Canada, which is projected to have a capacity of up to 90 GWh.

Thomas Schmall, Board Member for Technology of Volkswagen Group, remarks: "This investment represents a milestone in our journey toward a fully electric future.

"By collaborating with Patriot Battery Metals, we are securing key raw materials for cutting-edge, sustainable battery technology and reinforcing our commitment to North America."

A pioneering lithium project

The Shaakichiuwaanaan Project, currently under development, is poised to become one of the largest lithium pegmatite resources in the Americas and the eighth-largest globally. With its high-grade deposit, the project holds the potential to provide long-term stability for PowerCo's battery operations.

Ken Brinsden, CEO of Patriot Battery Metals, highlights the partnership's importance: "The investment by Volkswagen Group and PowerCo underscores the world-class status of the Shaakichiuwaanaan Lithium Project and reinforces our role in the global EV supply chain."

Sustainability at the core

The partnership supports shared values around sustainability and environmental responsibility.

Patriot Battery Metals and PowerCo aim to implement industry-leading ESG standards, focusing on waste management, water use, community engagement with First Nations and carbon emissions reduction.

Through a non-binding Memorandum of Understanding, the companies will explore further opportunities, including establishing a sustainable, cost-competitive supply chain for battery-grade lithium chemicals.

Jörg Teichmann, Chief Procurement Officer at PowerCo, states: "This collaboration will drive the development of a resilient and sustainable battery industry. Together, we aim to set a benchmark in ESG compliance while ensuring long-term security for the battery materials supply chain."

Expanding PowerCo's global footprint

As Volkswagen transitions to fully-electric mobility, PowerCo is positioning itself as a global leader in battery production. With its roots in Europe and growing operations in North America, the company focuses on developing a robust EV battery ecosystem.

The St. Thomas gigafactory in Canada will be PowerCo's largest battery cell production facility, supported by the consistent lithium supply from projects like Shaakichiuwaanaan.

The strategic integration is pivotal to meeting the increasing demand for EV batteries while ensuring cost competitiveness and supply chain security.

Building a North American e-mobility ecosystem

Volkswagen's investment in Patriot Battery Metals is more than just a supply chain move—it is part of a larger strategy to establish a dedicated e-mobility ecosystem in North America. This strategy includes everything from battery technology and raw material sourcing to software and vehicle architecture.

"By building a North American supply chain for EV batteries with partners, we are driving forward the development of a resilient battery industry," Jörg adds. 

As automakers race to electrify their fleets, securing a sustainable and reliable lithium supply is crucial. Volkswagen and PowerCo's partnership with Patriot Battery Metals demonstrates a commitment to innovation, sustainability and long-term growth in the global EV market.

For Patriot Battery Metals, the partnership validates the potential of its lithium resources and positions the company as a key player in the evolving EV supply chain.

"We are witnessing the foundation of a transformative future in transportation," continues Ken. "This partnership benefits our companies and drives forward the global transition to electric mobility."

By securing critical resources and fostering collaboration, Volkswagen and PowerCo are paving the way for a sustainable, electrified future.

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