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Volvo Invests In Blockchain Firm Circulor To Help Trace Cobalt Used In Batteries

volovo circulor 070920 lt

Swedish luxury carmaker Volvo Cars has made an investment in British blockchain start-up Circulor through its venture capital investment arm, Volvo Cars Tech Fund. Circulor specializes in tracking raw materials by using blockchain technology and artificial intelligence.

The two companies have already been working in the past years on the implementation of blockchain technology to boost the traceability of cobalt used in lithium-ion electric car batteries. Volvo became the first carmaker to implement blockchain-powered cobalt traceability in November last year.

Circulor has helped Volvo to use blockchain technology throughout its battery supply chain to achieve 100 per cent traceability of cobalt used in the XC40 Recharge P8 SUV, its first fully electric car unveiled in October last year. Production of the SUV will start later this year in Ghent, Belgium.

The investment will also enable both companies to expand their focus beyond cobalt, by looking at increasing traceability of mica, a mineral used as isolation material in the battery pack of electric Volvos.

The two companies are also looking to expand their partnership to other areas such as tracking and reducing CO2 footprints, helping Circulor to potentially set standards for ethical sourcing in automotive and other industries. Circulor can also help Volvo use blockchain in its operations and contribute to a more sustainable business.

The technology developed by Circulor is implemented in partnership with China-based Contemporary Amperex Technology Co., Ltd. (CATL) and South Korea-based LG Chem, Volvo Cars' lithium ion battery supply partners.

CATL and LG Chem also fulfil Volvo Cars' strict sourcing guidelines in terms of technology leadership, responsible supply chains, reduction of carbon emissions and competitive cost models.

The Volvo Cars Tech Fund was launched in 2018 and invests in high-potential technology start-ups around the globe. This investment is part of a funding round by Circulor, which also involves three other investors - SYSTEMIQ, Total Carbon Neutrality Ventures and Plug & Play.

In October 2019, Volvo Cars also launched an ambitious climate plan to reduce carbon emissions by 40 percent per vehicle by 2025, as well as a continued commitment to ethical business across its entire operations and supply chain.

In February this year, luxury car maker Mercedes-Benz also teamed up with Circulor to conduct a pilot project for transparency on CO2 emissions in the cobalt supply chain as part of Startup Autobahn, Europe's largest innovation platform founded by Daimler AG in 2016.

German car maker Volkswagen Group joined an industry consortium In April 2019 to use blockchain technology for the responsible sourcing of strategic minerals which are used in the production of vehicles.

Last year, Ford Motor Co. and Volkswagen joined an industry consortium consisting of IBM Blockchain, Huayou Cobalt, LG Chem and RCS Global to launch a blockchain pilot program to trace and validate ethically sourced minerals which are used in the production of vehicles.

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