Volvo invests in blockchain start-up to track cobalt
July 14, 2020
Swedish car maker Volvo has invested in UK blockchain technology start-up Circulor to help trace the use of cobalt in its electric-vehicle batteries.
Circulor and Volvo have been working together in recent years on the implementation of blockchain technology to boost the traceability of cobalt used in the batteries of its electric cars.
The blockchain technology is used throughout Volvo’s car battery supply chain, which aims to achieve 100 per cent traceability of cobalt used in the XC40 Recharge P8, its first fully electric car. Production of the XC40 Recharge P8 will start later this year in Ghent, Belgium.
The investment allows both companies to expand their focus beyond cobalt, for example by looking at increasing traceability of mica, a mineral used as isolation material in the battery pack of electric Volvos.
Volvo and Circulor are also investigating the possibility to expand their blockchain technology cooperation to other areas, for example tracking and reducing CO2 footprints, helping Circulor set standards for ethical sourcing in automotive and other industries.
“We are committed to an ethical supply chain for our raw materials and our partnership with Circulor has been instrumental in that regard,” said Martina Buchhauser (pictured below), chief procurement officer at Volvo Cars. “By supporting Circulor’s ongoing development we can expand the use of blockchain technology in our operations and contribute to a more sustainable business.”
The investment is part of a funding round by Circulor, which also involves three other investors: Systemiq, Total Carbon Neutrality Ventures and Plug & Play.
Volvo Cars was the first car maker to implement global traceability of cobalt used in its batteries by applying blockchain technology across its supply chain. The technology developed by Circulor is implemented in partnership with CATL and LG Chem, Volvo Cars’ battery supply partners.
CATL and LG Chem are battery manufacturers with track records supplying lithium ion batteries to the global automotive industry. They fulfil Volvo’s sourcing guidelines in terms of technology leadership, responsible supply chains, reduction of carbon emissions and competitive cost models.
The agreements between Volvo Cars, CATL and LG Chem cover the supply of batteries over the coming decade for next generation Volvo and Polestar models, including the XC40 Recharge P8.
The investment was made through the Volvo Cars Tech Fund, the company’s venture capital investment arm. The fund was launched in 2018 and invests in high-potential technology start-ups around the globe. It focuses its investments on strategic technology trends transforming the auto industry, such as artificial intelligence, electrification, autonomous driving and digital mobility.