Volkswagen secures raw materials closes gap with rival Tesla

German carmaker Volkswagen announced key partnerships to secure raw materials Europe's largest carmaker needs to realise its ambitious electric vehicle strategy, eager to close a gap with rival Tesla .

At the core of the three agreements, which are part of VW's 30 billion euro ($34 billion) plan to build battery plants and procure materials, lies a planned joint venture with Belgian chemicals and recycling company Umicore.

The venture aims to supply cathode materials to Volkswagen's European battery cell factories, which it plans to build by 2030. It will start production in 2025 with 20 gigawatt hours (GWh) for VW's plant in Salzgitter, Germany, which it plans to build with China's Gotion High-Tech.

The joint venture's goal is to reach annual production capacity of up to 160 GWh by the end of the decade, enough capacity to power approximately 2.2 million battery-powered electric vehicles.

"Volkswagen is implementing its battery strategy very consistently and at a high pace," board member Thomas Schmall said.