Volkswagen wants to invest in mining to become a global battery supplier

German carmaker Volkswagen wants to invest in mining. The move is intended to help it cut the cost of producing battery cells, cover half of its own battery demand and sell batteries to other customers. Thomas Schmall, the board member responsible for technology, said so in an interview with Reuters.

Europe’s largest carmaker wants its battery division, PowerCo, to produce batteries not only for Volkswagen’s own needs but also to become a global battery supplier. Schmall added that PowerCo will supply batteries for 1.2 million vehicles made by US carmaker Ford, which will build them on Volkswagen’s electric platform.

In the long term, Volkswagen plans to produce enough cells to meet half of its global battery needs. Most of its production capacity is to be located in Europe and North America. Mining capacity is a challenge, however, so the company must invest directly in mines.

Mining companies in Canada are expected to supply Volkswagen’s first North American battery plant. Schmall declined to say when and where Volkswagen might invest directly in mines, saying the company would not disclose this information until the market situation stabilises.