Toyota turns to Redwood Materials startup for critical battery materials

Battery cells produced at Toyota’s future North American EV factory will one day contain a little Redwood Materials DNA.

The two companies announced Thursday that Redwood Materials will supply Toyota with cathode material and anode copper foil for battery cells made at the automaker’s $13.9 billion plant in North Carolina that is scheduled to be in production by 2025. The deal is significant in Redwood. But it’s also a win for Toyota, which now has a US source for two critical components that account for most of a battery cell’s cost and are manufactured entirely overseas.

While Redwood and Toyota did not disclose the terms of the agreement, it is likely to be similar to a similar deal with Panasonic worth several billion dollars.

The agreement marks the expansion of a partnership between Redwood Materials and Toyota that was announced in June 2022. Under the first partnership, Redwood Materials agreed to refurbish or recycle batteries from hybrid and electrified vehicles. at Toyota. For batteries that cannot be refurbished, Redwood extracts materials such as copper, lithium, cobalt and nickel and then remanufactures those materials into components that can be returned to Toyota for cell manufacturing.

The effort was announced as the first batch of Toyota Prius cars released 20 years ago, retired from the road. And it will only grow. Toyota’s battery lifecycle ecosystem is estimated to include the recycling, remanufacturing and repurposing of nearly five million operating units, according to the automaker.

This latest deal ups the ante – and the value – for Material Redwood, a lithium-ion battery and materials recycling startup founded by former Tesla CTO JB Straubel. Under a long-term agreement, Redwood will now supply cathode active material and copper foil manufactured at its US facilities. The cathode materials supplied by Toyota at its North Carolina factory will include a minimum of 20% recycled nickel, 20% recycled lithium, and 50% recycled cobalt as well as 100% recycled copper in the anode copper foil.

Lithium-ion batteries have three critical building blocks. There are two electrodes, an anode (negative) on one side and a cathode (positive) on the other. Usually, an electrolyte sits in the middle and acts as a courier to move ions between the electrodes when charging and discharging. Cathode foils, which account for more than half the cost of a battery cell, contain lithium, nickel and cobalt. Redwood obtains all materials through battery recycling and processing.

Redwood continues to expand its Carson City, Nevada headquarters and is expected to break ground on a second battery materials campus in South Carolina later this year. The two campuses will recycle, refine, and produce battery materials, aiming to scale the production of the components in the planned amount of 100 gigawatt-hours per year worth of materials, enough for one million electric cars by 2025.

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