Ford Motor Co. is partnering with and investing $50 million into a battery recycling startup led by a Tesla co-founder as the Dearborn automaker works to shore up its battery supply chain for a forthcoming wave of electric vehicles.
Ford and Redwood Materials announced the deal Wednesday and said the two companies will work together "to integrate battery recycling into Ford's domestic battery strategy."
“Ford is making electric vehicles more accessible and affordable through products like the all-electric F-150 Lightning, Mustang Mach-E and E-Transit, and much more to come,” Ford CEO Jim Farley said in a statement. “Our partnership with Redwood Materials will be critical to our plan to build electric vehicles at scale in America, at the lowest possible cost and with a zero-waste approach.”
Redwood, which was started by Tesla co-founder JB Straubel and is based in Nevada, claims that its recycling technology can recover, on average, more than 95% of materials such as nickel, cobalt, lithium and copper that are found in EV batteries. Those materials then can be reused.
Meanwhile, Redwood announced last week that it will produce battery materials, supplying anode copper foil and cathode materials to battery makers. The startup plans to ramp up to 100 gigawatt hours of cathode material, enough to supply more than 1 million EVs by 2025. The company said Wednesday that as part of its partnership with Ford, "we're discussing how Redwood could supply Ford’s American battery facilities to ensure a steady, domestic source of sustainable battery materials to fuel the production of Ford electric vehicles."
Straubel recently told Bloomberg that his broader ambition is to move much of the battery component industry from Asia to the U.S.: "It's both inspiring and terrifying to see so many nations and car companies announcing their shift to electric vehicles. But there's a massive gap in what needs to happen."
Though electric vehicles today make up just a sliver of new-vehicle sales, industry experts and forecasters expect that to grow significantly before decade's end as governments around the world tighten environmental regulations to combat climate change and automakers bet heavily on electrification. President Joe Biden wants half of vehicle sales in the U.S. to be electric by 2030.
Establishing a battery recycling infrastructure is one of the keys to securing the domestic battery supply chain that the U.S. needs to be a major player in the electric transition, the U.S. Department of Energy has said. And, as The Detroit News previously reported, there is money to be made in EV battery recycling.
Battery recycling also is an environmental imperative. Most lithium-ion batteries used in EVs today will last between 11 and 13 years. If they end up in a landfill at the end of their life, they could pose environmental and health risks and require new raw materials mining projects that raise environmental and human rights concerns.
"The need for battery recycling is going to be huge over the coming decades, because the amount of batteries that we're going to need to replace the entire vehicle fleet with electric is going to be tremendous," said Sam Abuelsamid, principal analyst leading e-mobility research at Guidehouse Insights.