Volvo is investing in a blockchain firm Circulor through its venture capital investment arm, Volvo Cars Tech Fund. The investment is part of a funding round by Circulor, which also involves three other investors: SYSTEMIQ, Total Carbon Neutrality Ventures and Plug & Play.
The partnership will help both companies to explore ways of harnessing blockchain technology to improve Volvo’s products.
Volvo already uses Circulor’s technology to boost traceability of cobalt in Volvo’s batteries for electric cars in the last few years. Circulor’s blockchain technology is now used throughout the battery supply chain for Volvo cars with a target to achieve 100% traceability of cobalt used in its first fully electric car, the XC40 Recharge P8.
Partnership to go beyond Cobalt traceability
Volvo is the first automobile company to adopt blockchain technology for global traceability of Cobalt used in its car batteries with the help of CATL and LG Chem, Volvo Cars’ battery supply partners. Going forward, the automobile giant intends to use Circulor’s technology to track and reduce CO2 footprints. If it succeeds, Circulor could set standards for ethical sourcing in automotive and other industries.
“We are committed to an ethical supply chain for our raw materials and our partnership with Circulor has been instrumental in that regard,” said Martina Buchhauser, chief procurement officer at Volvo Cars. “By supporting Circulor’s ongoing development we can expand the use of blockchain technology in our operations and contribute to a more sustainable business.”Martina Buchhauser, chief procurement officer at Volvo Cars.
Launched in 2018, The Volvo Cars Tech Fund invests in high-potential technology start-ups around the globe. Its focus is on evolving technologies such as artificial intelligence, electrification, autonomous driving and digital mobility which could play a key role in transforming the automobile industry.
CATL and LG Chem meet Volvo Cars’ strict requirements in terms of technology leadership, responsible supply chains, reduction of carbon emissions and competitive cost models which is why they intend to work together for a long time.
Electric cars manufacture to start soon
The production of the XC40 Recharge P8, Volvo Cars’ first fully electric car is scheduled to start later this year in Ghent, Belgium. In collaboration with Circulor, the company plans to use blockchain technology for increasing traceability of mica, a mineral used as isolation material in the battery pack of electric Volvos.
In the 2019 financial year, Volvo Car Group recorded an operating profit of 14.3 BSEK (14.2 BSEK in 2018). Global car sales increased by nearly 10% from 2018 and revenue amounted to 274.1 BSEK (252.7 BSEK). With the production of fully electric cars which are becoming the norm, the company may be setting itself up for further growth this year and beyond.