With its move into electric vehicles, Volkswagen (VW) is now looking to secure supplies of cobalt for the next 10 years. Cobalt is a component in the manufacturing of rechargeable batteries.
This would mean negotiations with suppliers from the Democratic Republic of Congo (DRC) which produces over 60% of the world's cobalt supplies. Other major suppliers of cobalt are Zambia, Canada, China, Russia and Australia.
It is being reported that VW has asked cobalt producers to submit proposals on supplying the material for up to 10 years from 2019. This is as part of the German car manufacturers strategy as it plans to invest more than $24 billion in zero-emission electric vehicles by 2030.
Earlier in 2017, as part of its expansion plans in Afrika, VW announced it is entering the ride-hailing space in Rwanda with the launch of a new 'integrated mobility concept' in Kigali, following the signing of a memorandum of understanding between Rwanda's President Paul Kagame and Volkswagen CEO Dr Herbert Diess. The company also announced a vehicle production facility in Kigali to cover vehicle demand. The facility is on track to start operations at the end of 2017 with an initial plan to produce 1,000 cars annually.
With many car manufacturers moving towards electric vehicles, it is expected that demand for cobalt will rise sharply.