Mercedes Benz Acquires Stake in Battery Cell Manufacturer Farasis

Mercedes-Benz has formed a strategic partnership with the Chinese battery cell manufacturer Farasis and is also taking an equity stake in the company.

Mercedes-Benz has announced it is taking another important step on its journey towards CO2-neutral mobility. The Stuttgart-based luxury car manufacturer has launched a far-reaching strategic partnership with the Chinese battery cell manufacturer Farasis Energy (Ganzhou), including taking an equity stake in the company. This move represents another important milestone towards Mercedes-Benz’s “Ambition2039” CO2-neutral goal.

Key elements of the agreement include the development and industrialisation of highly advanced cell technologies, accompanied by ambitious goals for cost competitiveness. The technological focus is on significant increases in range through advances in energy density and the reduction of charging times.

The contract will provide a secure source of supply of battery cells for Mercedes-Benz’s electrification strategy, while Farasis gains security for its planned construction of production capacity. In order to be able to meet the increasing demand for German Mercedes-Benz plants in the future, Farasis is building a plant for battery cells in Bitterfeld-Wolfen; creating up to 2,000 new jobs. The East German site is designed as a CO2-neutral factory from the start.

“We are very pleased to further expand our partnership with Farasis in taking a decisive step within the implementation of our electric strategy ‘Electric first’. By strategically expanding our business relationship, we are pushing the electrification of our model portfolio ahead,” said Markus Schäfer, Member of the Board of Management of Daimler AG and Mercedes-Benz AG.

“With this agreement, we contribute our expertise in the field of battery cell development. At the same time, we are providing a boost for Farasis’s new plant and promoting the sustainable development of key technology and its establishment in Germany. We share with our partner the common vision of a more sustainable world through CO2-neutral mobility.”

With this strategic partnership, Mercedes-Benz is deepening its sustainability activities and further strengthening its existing business relationship with the battery cell supplier by taking a stake of around three percent. To this end, Daimler Greater China is investing a multi-million euro amount as part of Farasis’ IPO. It will give Daimler the option to nominate a representative for a seat on the supervisory board of the battery cell manufacturer. Markus Schäfer would intend to take the seat after a period of 12 months subject to regulatory approval of the voting process. 

As part of the “Electric first” strategy, Mercedes-Benz is implementing the electrification of all model variants and vehicle types. In less than 20 years, the firm’s new car fleet will be CO2-neutral, and by 2030 the company aims to ensure that more than 50 percent of its passenger car sales are plug-in hybrids or all-electric vehicles.

Fully electric Mercedes-Benz trucks, vans and buses are already in series production. By the end of this year, the firms’ goal is to have five fully electric passenger car models and 20 plug-in hybrid variants on the market.