A BYD, the Chinese electric vehicle giant, which will have a plant in Bahia, is expanding its activities in Chile as part of a project to mine lithium, the main metal for electric vehicle batteries. The South American country is home to the world’s largest metal reserves, making it a strategic location for the company.

The Chinese company, which is already the second largest battery manufacturer in the world, plans to invest US$290 million in a lithium cathode plant in northern Chile.. Currently, most of BYD’s refining is done in China, and the move to Chile will provide direct access to valuable lithium reserves in the South American region.

In April, BYD gained access to preferential prices for lithium carbonate in Chile. The Chilean government has given the company a special status due to plans to build a plant that is expected to start producing lithium iron phosphate for cathodes by the end of 2025. A cathode is a negatively charged electrode through which electrons enter an electrical device. .

“We are now sending a team of engineers to conduct a feasibility study and site selection.” said Stella Lee, executive vice president of BYD, in an interview given at the Bloomberg office in Sao Paulo.

Electric vehicle and battery manufacturers are benefiting from increased demand for clean energy and the shift away from fossil fuels. However, these industries also face problems related to the lack of raw materials. To secure future supplies, many producers are investing in upstream and downstream projects.

Important South American Market

In Chile, BYD is finalizing its project contracts at a time when the government is adopting a new lithium mining model that gives the state a stake in new ventures. At the same time, the Chilean government will intensify its efforts to encourage investment in the downstream sector. According to Stella Lee, BYD is ready to cooperate with the Chilean authorities, including offering its technologies to the government.

With the Lithium Specialized Producer status granted, BYD will have access to preferential prices for 11,244 metric tons per year of lithium carbonate for batteries through 2030, supplied by SQM, Chile, the world’s second largest lithium producer.

With the expansion of its activities in Chile and the construction of a new plant in Bahia, BYD is strengthening its position as a leading player in the electric vehicle sector and is contributing to the development of the clean energy industry in both Brazil and Chile.

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Source: Bloomberg.

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