At the start of the year, the Volkswagen Group made a commitment to buy several billion euros worth of batteries from the world number one CATL. The Chinese will not be its sole supplier however, since VW will build a factory with the Swede Northvolt.
Within the Volkswagen Group, the Audi premium branch has already secured a supply of lithium-ion batteries from the Chinese CATL, the world leader in automotive batteries. However, there is no question of putting all your eggs in one basket. As surely as the manufacturers distribute their tire orders to several manufacturers, they strive to sign with at least two battery suppliers, even if they are both domiciled in China.
Thus, at the end of August, the same Audi announced its intention to partner with BYD, the world’s third largest battery manufacturer. For its part, Groupe PSA obtains its supplies from CATL and LG Chem. The latter already supplies the Volkswagen Group, alongside its Korean compatriot Samsung SDI.
Multiply battery suppliers to compensate for the Chinese stranglehold
Anxious to escape the risks and constraints of a Chinese stranglehold on the sector, the German Volkswagen AG and the Swedish Northvolt AB announced on September 6, 2019 that they had created a 50/50 joint venture with a view to building a lithium-ion battery plant in Salzgitter, Lower Saxony. Work should begin in 2020, with production start-up scheduled for late 2023, or early 2024. Initial annual production should be 16 GWh.