BMW secures long-term battery cells supply
The order volume for CATL, originally announced in mid-2018 and worth € 4 billion, will increase to € 7.3 billion (contract period: 2020 to 2031). The BMW Group will account for €4.5 billion while the Chinese production site of the joint venture BMW Brilliance Automotive Ltd. (BBA) in Shenyang accounts for € 2.8 billion. This makes the BMW Group the first customer of the CATL battery cell plant currently under construction in Erfurt, Germany.
In addition, BMW has signed a long-term supply contract for the fifth generation of electric drives with its second battery cell supplier, Samsung SDI. The contract is worth € 2.9 billion (contract period: 2021 to 2031).
BMW will purchase the key raw material cobalt required for cell production directly from mines in Australia and Morocco and provide it to CATL and Samsung SDI. This also applies to lithium, which BMW will also purchase directly from raw material mines, including in Australia. This gives the company complete transparency as to the origin of these two raw materials. In addition, with the introduction of the fifth generation of electric drives in 2021, the company will completely dispense with the use of rare earth materials.
Assembling the battery cells into complete battery systems takes place at the BMW Group plants in Dingolfing (Germany), Spartanburg (USA) and at the BBA plant in Shenyang (China). The BMW Group has also localised battery production in Thailand and is working with the Dräxlmaier Group to do so.
On November 14, the company also opened its Battery Cell Competence Center in Munich. The aim of the competence center is to advance battery cell technology and penetrate production processes technologically. The company is investing € 200 million in the site and will employ up to 200 persons there. The production of battery cell prototypes makes it possible to fully analyze and understand the value-added processes of the cell. Andreas Wendt, member of BMW’s Board of Management who oversees purchasing and the supplier network, explains: “Whether we produce the cells in series at a later date depends largely on the development of the supplier market.”
The BMW Group runs a joint technology consortium with Swedish battery manufacturer Northvolt and Umicore, a Belgian developer of battery materials, to develop the cell technology that is crucial for electric mobility. The collaboration will focus on building a complete, sustainable value chain for battery cells in Europe, from development to manufacturing and recycling. The recycling of battery components plays a decisive role in closing the recycling cycle in the best possible way by comprehensively recycling raw materials in the face of strongly increasing demand for battery cells, BMW said in a press release.
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