Chinese battery manufacturer and German chemical supplier BASF jointly announced on September 16 that they have signed a strategic framework agreement to collaborate on battery recycling and production of cathode active materials (CAMs). This partnership will support not only CATL in its localization efforts in Europe but also BASF in its global expansion.

Together, CATL and BASF will build a sustainable supply chain for battery materials. Commenting on the framework agreement, Zhou Jia, president of CATL, said that teaming up with BASF is a major step forward in deepening CATL’s presence in Europe. Zhou added that the two companies will be leveraging each other’s expertise in battery technologies and advanced materials. This way, they will be able to provide better services to clients around the world and contribute to the promotion of carbon neutrality policies.

For BASF, the framework agreement represents a huge opportunity to form a tight cooperative relationship with a leading battery manufacturer. Dr. Markus Kamieth, who serves on BASF’s board of executive directors, said that the combination of BASF’s strength as a major supplier for CAMs and CATL’s strength as a major developer of lithium-ion batteries will accelerate innovations, thereby hastening the formation of a sustainable supply chain.

BASF recently announced that it will build a “prototype plant” for battery recycling in Schwarzheide, a town in eastern part of Germany. The plant will be at the same site where the company is also constructing a plant for manufacturing CAMs. According to the company’s press releases, the plant for manufacturing CAMs will have an annual production capacity that meets the demand of more than 400,000 BEVs. As for the plant for recycling lithium-ion batteries, BASF will use the facility to develop and optimize the processes for extracting valuable metals from used batteries before large-scale deployment. Both plants are set to enter operation in 2022.

An article published this January in Nikkei Asia said that the major Chinese manufacturers of EV batteries including CATL, Farasis Energy, and SVOLT will be investing over US$3 billion in new production facilities in Germany. CATL entered the country as early as 2014 and began setting up factories and R&D centers there around 2018-2019. This September, CATL formally joined the European Battery Association (EUROBAT).