Canadian government signs EV deals with Mercedes-Benz and Volkswagen

Canada’s federal government has signed separate agreements with German automakers Volkswagen and Mercedes-Benz that will see the two manufacturers secure access to Canadian raw materials for batteries in electric vehicles (EVs).

On Aug. 23, Prime Minister Justin Trudeau and German Chancellor Olaf Scholz observed the signing ceremony in Toronto at an event hosted by the Canadian-German Chamber of Industry and Commerce.

In a statement, the federal government said these agreements will “help secure Canada’s position as a leading centre of excellence for the manufacturing of electric vehicles and batteries.”

The Volkswagen agreement focuses on deepening co-operation on sustainable battery manufacturing, cathode active material production, and critical mineral supply. Volkswagen has said it could become a shareholder in local mining firms to make sure it is first in line when it comes to supply. “The supply of battery raw materials and the production of precursor and cathode materials with a low carbon footprint will allow for a fast and sustainable ramp-up of battery capacity – a key lever for our growth strategy in North America,” outgoing Volkswagen chief executive Herbert Diess said.

The Mercedes-Benz agreement, meanwhile, focuses on enhancing collaboration with Canadian companies along the EV and battery supply chains and supporting the development of a sustainable critical mineral supply chain in Canada. As part of the arrangement, Mercedes-Benz will explore a strategic partnership with Rock Tech Lithium, under which the Canadian firm would supply the German carmaker and its battery partners with up to 10,000 tonnes of lithium hydroxide a year from 2026.