The German car maker establishes a partnership with Farasis Energy. In this way, Daimler wants to secure its supply of battery cells.
The car maker Daimler is getting involved in the Chinese battery cell manufacturer Farasis Energy, thus further securing supplies for its electric models. Daimler announced on Friday night that a far-reaching strategic partnership including equity participation had been launched. For an unspecified amount of millions, the group will participate in the course of the Farasis IPO with around three percent.
As a strategic partner, the Chinese manufacturer is a “fixed cornerstone” in the existing team of battery cell suppliers, it said. The contract offers Daimler and its core brand Mercedes-Benz a secure delivery, while Farasis receives planning security for capacity building.
Daimler and Farasis had already agreed on a partnership for the production of battery cells with electricity from renewable energies in summer 2019. The contracts have now been supplemented. Under certain circumstances, Farasis could enter the next generations of the Mercedes-Benz EQ electric models as a supplier at an early stage. Daimler in turn may send a representative to the Farasis board of directors. However, the participation is still subject to any regulatory approvals.
Daimler sees participation as an important milestone in achieving its sustainability goals. The entire new Mercedes-Benz fleet should be CO2-neutral by 2039 at the latest, and this should apply to production as early as 2022.
“With the first-time participation in a Chinese battery cell manufacturer, we want to increasingly use the potential of innovative technology partners in the Chinese market and thus consistently pursue our global electrical strategy,” said Daimler’s China board member Hubertus Troska. Activities in research and development, production and purchasing in China would be expanded.
Daimler develops and builds the batteries for its cars itself and is currently pulling up a worldwide network of factories. The group buys the heart of the battery, the cell, from a number of external manufacturers. Farasis has so far only produced in China, but is also building a plant in Bitterfeld-Wolfen in Saxony-Anhalt, among others.