Umicore and PowerCo explore long-term strategic supply agreement for EV battery materials in North America

Umicore and PowerCo, Volkswagen’s battery company, aim to extend their collaboration in battery materials and are exploring a strategic long-term supply agreement¹ to serve PowerCo’s future battery Gigafactory for electric vehicles (EVs) in North America. 

This planned, non-exclusive agreement, would make PowerCo an important customer for Umicore’s planned battery materials production plant in Ontario, Canada. This future facility would combine the production of precursor and cathode materials and thereby complete the missing link in Canada’s battery value chain from natural resources to electric mobility.

Umicore is in negotiations with several potential customers for production contracts in North America. These will form the basis for Umicore's final investment decision and underline its commitment to value creating returns. Pending those contracts, Umicore expects to start construction of its Ontario Gigafactory in 2023 and operations at the end of 2025 with the potential to reach, by the end of the decade, an annual production capacity capable of powering approximately one million EVs. The plant could start supplying PowerCo as of 2027, with up to 40 gigawatt-hours (GWh) annually by 2030, equivalent to about 550,000 EVs. 

“Taking our partnership across the Atlantic, would foster Umicore’s and PowerCo’s shared strategic convictions of enabling and accelerating clean mobility on a secure and sustainable local-for-local basis. For Umicore, a long-term cooperation with PowerCo would support our plans to build Canada’s first-of-its-kind precursor and cathode materials facility, which would in turn provide PowerCo with secure access to these critical materials and enable the ramp up of its battery cell production in North America.”

Ralph Kiessling, Executive Vice President of Umicore

Jörg Teichmann, Chief Purchasing Officer of PowerCo SE: “This partnership will provide PowerCo with access to locally produced battery materials for cell production in North America. We will benefit from tried and tested cooperation and the product quality of Umicore.”

A long-term supply of Umicore’s next-generation battery materials would fit both companies’ strategies to develop regional and fully integrated battery supply chain for North America. In Europe, Umicore and PowerCo agreed in September to form a joint venture to produce battery materials for about 2.2 million electric vehicles a year by the end of the decade. 

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¹ Memorandum of Understanding