Sustainable supply chain

What about lithium? Where does it come from? How is it produced?

An average battery pack contains between 20 and 30 kilos of lithium carbonate. Lithium in the form of Li-metal phosphate and Li-metal oxide are used in the cathode together with cobalt, nickel and manganese in the electrolyte. As a charge carrier, the alkali metal is regarded as indispensable for the foreseeable future, since no other element offers comparable properties for automotive battery applications. Lithium will soon become one of the world's most sought-after raw materials. Therefore, securing access to the resources and markets is essential. With this in mind, Volkswagen has entered into a strategic partnership with Ganfeng, a leading lithium producer based in China.

Volkswagen Group Components and its Center of Excellence for batteries is building a pilot plant for cell production at its plant in Salzgitter. A pilot recycling centre capable of processing 1,200 tonnes of batteries per year (equivalent to 3,000 vehicle battery packs) will be set up at this site by 2020. The plan is to gradually increase capacity over the following years. But large quantities of returned batteries are not expected until the late 2020s when many of the EVs mass produced after 2020 will reach the end of their service life.

In principle, batteries can start a second life after they have been removed from an electric vehicle, for example, as part of a charging station. Or the individual components can be shredded at the recycling plant Salzgitter. After the material has been dried and sifted, workers can recover the so-called 'black powder' that contains valuable raw materials, including nickel, manganese, cobalt and lithium. Once these materials have been separated, they can be used for the production of new batteries.

Worldwide lithium demand is expected to more than double by 2023. This is largely due to the fact that lithium is used to manufacture car batteries. Australia produces nearly 60% of global demand, Chile 19%, China 8% and Argentina 7%. In Australia, the light metal is obtained by mining certain ores. About half of global lithium production comes from hard rock deposits. While extraction is relatively quick, lithium production is expensive.

In the Chilean Salares, lithium production requires enormous amounts of groundwater – 21 million litres in the Atacama Desert alone – with devastating long-term consequences for local agriculture and the surrounding oases. While pumping the brine is tedious and costly, production is relatively inexpensive. Chile plans to quadruple lithium production by 2025.