Volkswagen China to set up joint ventures with Huayou Cobalt, Tsingshan Holding Group

Beijing (Gasgoo)- On March 21st, Volkswagen Group China inked two memorandums of understanding with China’s Huayou Cobalt and Tsingshan Holding Group, respectively, to strengthen the auto group’s competitiveness in the electric mobility field.

Photo credit: Volkswagen

The cooperation will help the three companies realize cost advantages and guarantee the supply of raw materials, building a transparent and sustainable supply chain. The trio aims to create a technical synergy throughout the entire industry, including precursors and anode materials.

As a crucial component of a lithium-ion battery, anode materials decide the power density and the cost of power batteries. The cooperation will help Volkswagen achieve its long-term goal of lowering its battery cost by 30% to 50% while elevating the power density of its batteries.

Moreover, Volkswagen, Huayou Cobalt, and Tsingshan Holding Group will set up an upstream joint venture for nickel and cobalt in Indonesia. The three parties will allocate each’s resources into manufacturing the raw materials of batteries. Upon completion, the joint venture will have a designed production capacity of 160GWh yearly.

Meanwhile, Volkswagen and Huayou Cobalt will establish another joint venture in Guangxi province, to refine nickel and cobalt sulfate and produce precursor and anode materials. With Huayou Cobalt’s integrated manufacturing technique, the German automaker will be able to further lower its battery cost and carbon emission.