Volkswagen China informed the media about a joint venture with the major cobalt supplier, Huayou Cobalt and Tsingshan Group, this Monday(March 21). Volkswagen China, expects to control the production cost of batteries from this deal.
The international sanctions have affected the production cost and material supply of even the most major companies and corporations around the globe. The venture made between the companies is expected to ensure cobalt and nickel supplies to suppress the inflating battery production cost.
The companies, Volkswagen, Huayou Cobalt and Tsingshan Group have signed an epistle in agreement to two ventures. The first is between the three companies in Indonesia, where they will assert their assets and invest in the production of battery raw materials. Above 10% of the global nickel ore reserves are found in Indonesia, Volkswagen stated.
Volkswagen will form its second venture with Huayou Cobalt. This venture secures the refining of nickel and cobalt, along with production of precursors and cathode medium. Volkswagen targets a significant cost control along with a consistent raw material provision. Volkswagen also expects a dependable supply chain through the ventures.
The German company, Volkswagen expects to accomplish its target of reducing battery manufacturing cost by 30-50% through the joint ventures. The company’s goal to maintain a level cost and reduce battery manufacturing cost to maintain their loyal client base is admirable.
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