Redwood inks long-term EV battery materials supply deal with Toyota

Panasonic Holdings

16/11/2023 12:00

By Paul Lienert
       Nov 16 (Reuters) - Redwood Materials has signed a
long-term contract to supply Toyota Motor  7203.T  with recycled
materials for the Japanese automaker's $13.9 billion North
Carolina electric vehicle battery plant, Redwood said Thursday.
    The Nevada-based materials specialist said it would
remanufacture EV battery components from materials supplied by
Toyota and recycled from end-of-life vehicles, mainly
hybrid-electric models such as the Prius.
    Redwood, one of the world's leading battery recyclers, did
not disclose details on value or timing of the agreement.
    In an interview, Redwood Chief Executive J.B. Straubel, a
co-founder and a director of global EV leader Tesla  TSLA.O ,
said the new contract will enable Redwood's business "to grow
and expand with Toyota's future needs."
    "We want to be a solution for them for years to come,"
Straubel said. "I expect they'll be continuing to grow that
plant and maybe others."
    Straubel has said Redwood is building a closed-loop, or
circular, battery ecosystem aimed at lowering EV costs by
lessening dependence on imported materials while reducing the
environmental impact.
    Redwood aims to build annual battery component production
capacity in the U.S. of 100 gigawatt-hours -- enough to supply
more than 1 million EVs a year, with the long-range option to
expand annual capacity to 500 GWh.
    Straubel, formerly Tesla's chief technology officer, founded
Redwood in 2017. The company has raised $2 billion at a
valuation of $5.25 billion, according to investor website
PitchBook, and has negotiated a Department of Energy-backed $2
billion loan.
    Straubel said the company will supply battery components to
Toyota from its Sparks, Nevada facility and eventually from a
$3.5 billion facility it is building outside Charleston, South
Carolina.
    Redwood will sell remanufactured cathode active material,
made from recycled lithium, nickel and cobalt, as well as anode
foil made from recycled copper. Those two components represent a
majority of the cost of current lithium-ion cells.
    Several companies have announced plans to make battery
components in North America, to take advantage of incentives
built into the U.S. Inflation Reduction Act and similar
legislation aimed at reducing imports of batteries and materials
from China.
    Redwood previously announced recycling deals with Panasonic
 6752.T , Volkswagen  VOWG_p.DE  and Ford  F.N , among others.
Redwood also is selling remanufactured battery components to
Panasonic, which jointly operates an EV battery plant with Tesla
in Nevada.

 (Reporting by Paul Lienert in Detroit; Editing by David
Gregorio)
 ((Paul.Lienert@thomsonreuters.com; mobile +1 313-670-2452;))