Mercedes-Benz has finalised a supply agreement with Canadian-German-start-up Rock Tech Lithium Inc. to secure high-quality lithium used in battery production as part of a direct sourcing approach.

It says that starting in 2026, including a qualification period, this allows Mercedes to get its battery partners supplied with raw material to rapidly scale up its production of fully electric vehicles.

Mercedes-Benz plans to go all electric by the end of the decade, wherever market conditions allow, requiring the brand to open new sources of raw materials with new partners.

As part of the agreement, Rock Tech Lithium plans to supply battery-grade lithium hydroxide to Mercedes-Benz battery partners from a converter based in Guben, Brandenburg, Germany. Lithium hydroxide is needed for the production of lithium-ion batteries which are used in Mercedes-Benz electric vehicles.

“This significant amount of lithium sourced directly from Rock Tech will help Mercedes-Benz to advance localisation of European production of state-of-the-art battery cells. Together with additional sourcing partnerships in the future, the on average 10,000 tonnes of lithium per annum will play a key role in securing the lithium supply for our battery production in Europe, to help achieve our ambitious electrification goals,” said Markus Schäfer, Member of the Board of Management of Mercedes-Benz Group AG, Chief Technology Officer, responsible for Research & Development and Procurement.

“Lithium hydroxide from Rock Tech offers Mercedes-Benz the opportunity to support two strategic goals: localized and reliable sourcing as well as production under high sustainability standards. We are very pleased to have found a partner that will take important steps with us towards a more resilient lithium supply chain and demonstrates trust in us to deliver an important part of their strategy and of the e-mobility transformation,” saidMarkus Bruegmann, Chief Executive Officer of Rock Tech Lithium.

The strategic partnership between Rock Tech and Mercedes-Benz was announced during a German-Canadian summit in Toronto in August this year following the signing of a Memorandum of Understanding between Mercedes-Benz AG and Canada to explore deeper cooperation across all stages of the automotive value chain, focusing on natural resources development.

The supply agreement provides that both companies will cooperate in creating a roadmap to achieving CO2 neutral production of lithium hydroxide by the end of 2030. Additionally, it requires that all lithium hydroxide supplied by Rock Tech shall be sourced from mining sites audited by the Initiative for Responsible Mining Assurances (IRMA).

Mercedes says it is working on finding levers for the consistent reduction of CO₂ as well as joining forces with others in order to reduce the amount of rare earth metals per electric drive significantly.