German automaker Volkwagen has entered into a strategic agreement with Ganfeng Lithium, a Chinese manufacturer of the chemical compound used in batteries, to ensure a steady supply of the chemical over the next ten years, according to Ganfeng’s filing with the Shenzhen Stock Exchange Monday.
Volkswagen, which is the largest automaker by sales in China, plans to roll out more than 70 models of electric vehicles that rely on lithium-powered batteries over the next six years so that by 2025, a quarter of its vehicles are electric ones, according to the filing.
The two companies will also cooperate in areas including battery recycling, which could be a big issue for China, which had the world’s largest stock of all-electric cars at about 2.4 million units at the end of 2018.
However, second-hand EVs are not as popular as traditional gasoline cars as the performance of batteries degrades greatly and new models are always equipped with more powerful batteries at lower prices.
Electric car battery prices are also set to slide 67% by 2030 on technology improvement and demand, according to Bloomberg New Energy Finance.
Contact the writer at ji[email protected]
Editor: Nadine Freischlad