Electric Vehicle News — Stellantis Reaches Agreement With Argentina Lithium For Exchange Right Deal

On 26 September 2023 it was announced that Stellantis concluded a definitive agreement with Argentina Lithium & Energy Corp to invest an equivalent of a US$90 million in Argentina Litio y Energia S.A.

Read about the full details of the exchange agreement in Resource World: Argentina Lithium Announces US$90 Million Investment by Stellantis in ARS$ Equivalent.

Thanks to Stellantis’ investment, the automobile leader will be able to carry out its electric vehicle (EV) strategy by acquiring 19.9% of Argentina Lithium’s shares.

This might not seem like a big amount — but it is!

All of the remaining shares in the company will be owned by Argentina Lithium. This give Stellantis an advantage over other EV competitors trying to break in to Argentina’s lithium production market for EV batteries.

After closing the deal, Argentina Lithium President & Chief Executive Officer Nikolaos Cacos told the public:

“We are delighted to have Stellantis as a partner in the future development of our lithium projects in Argentina. Together, we share a vision to build a sustainable lithium mining operation for the future. We look forward to a strong and successful relationship with Stellantis and we are committed to delivering a sustainable lithium product that will contribute to the electrification of transportation and the protection of our atmosphere.”

In addition to the exchange agreement, however, is even more exciting news for Stellantis in this deal. Argentina Lithium agreed to enter into an offtake agreement whereby Stellantis is guaranteed purchase rights of up to 15,000 tonnes per annum of lithium, produced by Argentina Lithium, over a seven-year period, until the offtake agreement is either ended or extended for a longer term.

This offtake deal, part of the exchange agreement with Argentina Lithium, really sweetens the pot for Stellantis as a global market leader for EVs. Since one of the main problems for EV market share is about the stable production and supply of batteries, of which lithium, cobalt and nickel are three of the primary metals in demand for the foreseeable future.

Read more content about Stellantis’ global market strategy for EVs below.

Stellantis’ Global Market Strategy Is Under Great Pressure From UAW Strikes

According to one of the latest reports by CNBC Stellantis might have to close 18 manufacturing facilities in the United States as a result of ongoing negotiations with the United Auto Workers (UAW) union.

Unsurprisingly, members of the UAW strongly oppose this move, which Stellantis mentioned would see more investments go toward modernization plans. For instance, the company’s parts and distribution network is being conceived as a “Mega Hub” for its future operations in North America.

This is a classic exercise in Concept Development. In order to keep its top position in the global marketplace, Stellantis wants to develop new concepts for how it makes and distributes its vehicle lineup to both North American and global customers. This modernization push is about the distribution of vehicle components and parts, but it is also part of the company’s push into global markets.

In addition, this is one of the company’s methods to adopt a digital transformation strategy of its operations and services, the likes of Amazon and Alibaba, who are killing it in the global e-commerce business.

Saudi Aramco & Stellantis Team Up For eFuel Engines In European Market

It was reported by Arab News on 10 September 2023 that Saudi Aramco and Stellantis “are ready to use advanced drop-in eFuel without any powertrain modification, following months of testing at its technical centers across Europe.”

The use of eFuel in automobiles is a method to lower carbon emissions compared with conventional fuels. This is part of Saudi Aramco’s strategy to produce more low-carbon synthetic fuels for light-duty passenger vehicles.

In what was likely to be one of the biggest headlines about business partnerships in industrials, Saudi Aramco and TotalEnergies agreed to give out engineering and production contracts (EPC) to begin building a world-class petrochemicals facility at the SATORP refinery in Saudi Arabia on 24 June 2023.

Saudi Aramco president and CEO, Amin H. Nasser, and TotalEnergies chairman and CEO, Patrick Pouyanne, signed the agreement with government officials from South Korea and Saudi Arabia in attendance.

According to a report about the signing ceremony by Arab News, this new petrochemical complex at the SATORP refinery will become the base for one of the largest mixed-load steam crackers located in the Persian Gulf.

These business agreements carry some significant weight to how producers are thinking about the geopolitical trends. For instance, one of the key concerns for Saudi Aramco is how it will balance its most important partners, like France and United States, with some of its most important customers, like China.

But it is also part of the Dare Forward 2030 Vision which Stellantis has been promoting since the 2023 Consumer Electronics Show (CES) held in Las Vegas.

Read more about the global EV market and energy transition strategy in Areas & Producers.

The content in Areas & Producers provides a methodology for readers and writers who are curious about global trends and the future of the world.