While Toyota (TM) -) is confident in its standpoint that the mass market is not quite ready for electric vehicles, citing instead the value in hybrids, the company is by no means sitting on the sidelines of the EV revolution.
The company in May said that it will be making three new, fully electric SUVs at its Kentucky plant beginning in 2025. A component of this ramp-up in EV production, the company said at the time, involved further investments in its North Carolina battery plant, which will begin production in 2025.
With that production date fast approaching, the automaker enhanced its partnership with Redwood Materials in a move Thursday that is designed to strengthen the company's battery supply chain.
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The agreement builds on a collaboration first announced last year for battery collection and recycling, and, according to Toyota, aims to create pathways for Toyota's EV batteries that have reached the end of their life.
Christopher Yang, Toyota North America's group vice president, said in a statement that the agreement will bring Toyota closer to its goal of creating a "closed-loop battery ecosystem."
Such an ecosystem, he said, will become "increasingly important as we add more vehicles with batteries to roads across North America.”
“Working with Redwood Materials, we are creating a circular supply chain to optimize logistics, expand refining, and ensure that the valuable metals recovered can be reintroduced into our future vehicles," he said.
As Toyota looks to expand its electric offerings, and as its first-generation hybrids reach the end of their lifecycle, the company is set to require much more in the way of battery recycling, as well as new battery production.
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The new framework will feed recycled materials — Cathode Active Material (CAM) and copper foil — from Redwood's facilities into new battery production at Toyota's $14 billion North Carolina battery plant.
"The use of recycled materials is anticipated to help increase the focus and relevance of domestic supply chains versus the extensive, carbon-intensive current supply chain of procuring outside of the United States," Toyota said in a statement.
The company said that its battery ecosystem will include the recycling, remanufacturing and repurposing of roughly five million units, an effort that will serve its goals of carbon neutrality.
Redwood, founded in 2017 by Tesla (TSLA) -) co-founder J.B. Straubel, has raised $2 billion so far, achieving a valuation of $5.25 billion. The company's goal is to create sustainable, circular battery supply chains as electrification efforts continue to ramp up.
Shares of Toyota, up around 39% for the year, ticked up slightly Thursday.
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