By Kim Richters

German car makers Volkswagen AG and Mercedes-Benz Group AG have agreed with Canada to explore ways to secure sustainable raw-materials sources for their battery-supply chains as they ramp up the production of electric vehicles.

The car makers said separately Tuesday that they have signed memorandums of understanding with the Canadian government.

Volkswagen, which has bundled its global battery operations in its PowerCo SE unit, said the supply of critical raw materials such as lithium, nickel and cobalt would be a key focus of the collaboration. It is currently reviewing potential sites for a planned large-scale battery factory in North America, it said.

Peer Mercedes-Benz said the agreement with Canada would include opportunities in the up-, mid- and downstream mining and refining segments, and it plans to sign an agreement with Rock Tech Lithium Inc. for the supply of lithium hydroxide.

"Mercedes-Benz is looking to open new ways to responsibly acquire raw materials to rapidly scale up electric vehicle production," the car maker's Chief Technology Officer Markus Schaefer said. "Securing direct access to new primary and sustainable sources of raw materials is a vital step down this road," he said.

Write to Kim Richters at kim.richters@wsj.com

(END) Dow Jones Newswires

August 23, 2022 11:44 ET (15:44 GMT)

Copyright (c) 2022 Dow Jones & Company, Inc.
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