BMW Group has signed a €540-million contract with China’s Ganfeng Lithium for the supply of raw lithium from mines in Australia. The carmaker has restructured its supply chains for its upcoming fifth generation of battery cells. From 2020 on, it will directly source both lithium and cobalt. The raw materials will then pass on to BMW’s two cell manufacturing partners, CATL and Samsung SDI.
BMW says this new process will ensure full transparency as to where raw materials come from. In the future, it will source cobalt directly from mines in Australia and Morocco. Supply contracts will ensure the company’s supply up to 2025.
BMW is increasing its order volume for battery cells from CATL to €7.3 billion, and also has signed a €2.9-billion contract with Samsung SDI for its fifth-gen electric powertrains, which it plans to make entirely free of rare earth metals.
The automaker plans to have 25 electrified models in its lineup by 2023, more than half of which will be fully electric. The company also aims to double its sales of electrified vehicles between 2019 and 2021.
Dr. Andreas Wendt, member of the BMW Board of Management, said, “The projected order volume [from Ganfeng Lithium] totals €540 million. In this way, the BMW Group is securing 100% of its lithium hydroxide needs for fifth-generation battery cells in its high-voltage batteries. Our need for raw materials will continue to grow. By 2025, for lithium alone, we expect to need about seven times the amount we do today.”