Umicore adjusts battery materials strategy because of slowdown in sales of electric cars

Brussels-based multinational Umicore has communicated about the adjusted strategy of its battery materials division. The construction of a battery materials recycling plant in Europe is postponed, as is that of a battery materials plant in Canada. The company points to the slowdown in sales of electric cars as the main cause.

“In recent months, short- and medium-term growth forecasts for the electric vehicle market have been significantly scaled back, which has had a significant impact on Umicore's Battery Materials activities,” stated Umicore in a press release. The company is adapting “to this new reality”.

With its battery materials division in crisis, Umicore is postponing plans to build the first large-scale recycling plant for rechargeable batteries in Europe. The development of a battery materials plant in Canada is also postponed for the time being.

Also remarkable is that the materials group is writing off €1.6 billion in its battery materials division. This write-down caused Umicore to plunge almost €1.5 billion net into the red for the first half of the year, reported Flemish newspaper De Tijd, and reduced its equity - the collective piggy bank of shareholders - from €3.6 billion to €2 billion. The company acknowledged that the large write-down is “painful”.

“In the coming months, we will continue to thoroughly review our Battery Materials activities, with energy and an open mind, always in close cooperation with our customers and partners,” stated the company. “We are shaping a new way forward.”

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