Nozaki, the new president of Japan's Sumitomo Metal Industries, Ltd. (SMM) said the company will focus on supplying battery materials to Toyota Motor Corp and Panasonic Corp. Both companies are Tesla Inc) battery pack supplier.
Although Toyota and Panasonic are already Sumitomo's largest customers, Tesla's best-selling model Model 3 has boosted sales of electric vehicles, meaning Sumitomo needs to maintain its dominant position.
Over the past four years, Sumitomo Metal has spent 37 billion yen (about 244.4 million pounds) to increase the production of nickel-cobalt-aluminum (NCA), which is mainly used as the cathode material for Panasonic lithium-ion batteries, and Panasonic lithium-ion batteries It mainly powers Tesla Model 3 and Model X.
Nozaki said: "The company's monthly production capacity of NCA cathode materials will reach 4,550 tons later this year, which is more than five times the monthly production capacity of 850 tons in 2014. And Tesla's production and sales are steadily increasing."
Toyota owns a 3.8% stake in Sumitomo Metal. Sumitomo Metal also provides different types of cathode materials for batteries in Toyota hybrid vehicles such as the Prius. Nozaki said the company may now continue to focus on serving existing customers. "Battery materials are custom products, not commodities, and we need to work with our customers to meet changing battery material needs," he said.
Sumitomo Metal is also Japan's largest nickel smelter, and its goal is to increase its annual output of nickel from 90,000 tons in March 2018 to 150,000 tons by March 2022. It also plans to increase copper output from its holding companies from 260,000 tons to 300,000 tons, and gold output from 14 tons to 30 tons.
Founded in 1590, Sumitomo Metal was originally a copper smelter. Its strength lies in the comprehensive production of electronic components, including the mining of nickel, the raw material to the production of battery materials. Unlike other resource companies around the world, it focuses on mining or smelting.
Nozaki also said: "Nickel smelters around the world want to supply battery materials, but they don't know what kind of nickel products they should provide, and we benefit from the supply chain and know such needs clearly."