Last week Volkswagen Group announced plans to double-down on building electric cars with 20 new models and an additional 7 million cars over five years.
So far it's said that the battery cells for its MEB vehicles will come from four different global suppliers: CATL, LG Chem, Samsung, and SK Innovation.
Now VW has announced that it is working to develop local battery technology and production in Europe by partnering with Northvolt, a startup Swedish battery manufacturer that has plans to build one of the largest battery factories in the world.
Mass-market electric carmakers, it turns out, are a lot more successful when they control their own battery supplies. And the main battery suppliers so far are based in South Korea, China, and Japan—and in Tesla's case, partly in the United States.
With some of the most stringent carbon-dioxide emissions standards in the world, Europe has emerged as a center of electric-car development, with most automakers there announcing plans to convert their fleets to plug-in power.
VW MEB platform
The new VW consortium with Northvolt will be called the European Battery Union, although it remains unclear whether any other automakers have signed onto the agreement.
BMW Group has also signed a partnership with Northvolt to develop new batteries from materials recycled from the batteries in its older EVs.
Mercedes-Benz hasn't announced where it will get the batteries for all the new EVs it has planned, but in December it announced that it will spend $23 billion on batteries for upcoming cars and trucks, and it is investing $1.1 billion to build a battery factory in Alabama for electric cars it plans to sell in North America.
VW says the European Battery Union will cover all aspects of batteries from procuring raw materials to developing cells to recycling, and will focus research efforts on developing factory technologies to produce batteries sustainably in the European Union. It aims to receive support from the German Ministry for Economic Affairs and Energy.
The EBU will share technology across all member companies regardless of nationality, and plans to begin research activities early next year.