German automotive brand Mercedes-Benz has signed a supply agreement with Canadian mining company Rock Tech Lithium to procure high-quality lithium used in battery production.
Under the terms of the agreement, signed as part of a direct sourcing approach, Rock Tech is expected to supply an average of 10,000 tons of battery-grade lithium hydroxide per year.
The mining company will supply the lithium hydroxide from its converter based in Guben, Brandenburg, Germany.
The deal, which requires sourcing from mines audited by Responsible Mining Assurances (IRMA), would enable carbon neutrality of lithium hydroxide production by the end of 2030.
Rock Tech Lithium chief executive officer Markus Bruegmann said: “Lithium hydroxide from Rock Tech offers Mercedes-Benz the opportunity to support two strategic goals: localised and reliable sourcing as well as production under high sustainability standards.
“We are very pleased to have found a partner that will take important steps with us towards a more resilient lithium supply chain and demonstrates trust in us to deliver an important part of their strategy and the e-mobility transformation.”
Mercedes-Benz intends to go all-electric by the end of the decade, requiring the brand to open new sources of raw materials with new partners.
Lithium hydroxide is an essential component to produce lithium-ion batteries, which are used in Mercedes-Benz electric vehicles.
The agreement will allow the German carmaker to supply its battery partners with raw materials in 2026 to rapidly scale up its electric vehicle manufacturing.
The strategic partnership was initially announced during a German-Canadian summit in Toronto, held in August this year.
It follows the signing of a memorandum of understanding (MoU) between Mercedes-Benz and the government of Canada to explore the automotive value chain.
Mercedes-Benz Group chief technology officer and board of management member Markus Schäfer said: “This significant amount of lithium sourced directly from Rock Tech will help Mercedes-Benz to advance localisation of European production of state-of-the-art battery cells.
“Together with additional sourcing partnerships in the future, the on average 10,000 tonnes of lithium per annum will play a key role in securing the lithium supply for our battery production in Europe, to help achieve our ambitious electrification goals.”
