Lithium Australia signs new exclusive battery recycling agreement with BYD Auto

Lithium Australia signs new exclusive battery recycling agreement with BYD Auto

• Lithium Australia has signed a new exclusive agreement with BYD Auto Industry Company Limited (hereinafter referred to as “BYD Auto”) to provide battery recycling services for all New Energy vehicles 1 end-of life batteries in Australia
• BYD Auto, the automotive subsidiary of BYD Company Limited, is a global leader in New Energy vehicles, delivering a record ~3 million New Energy vehicles globally in 20232 and holds ~14% of Australia’s EV market share after entering the market in 20223
• The exclusive agreement has an initial term of 3 years, and the Company expects to significantly increase large-format lithium-ion battery collection volumes given the scale of BYD Auto
• Lithium Australia remains focused on executing its strategy of signing recycling agreements with leading EV and ESS manufacturers to secure future lithium-ion battery supply
• Lithium Australia’s recycling operations continue to achieve operating cash profits into FY25 following the maiden operating cash profit in Q4 FY244

Lithium Australia Ltd (ASX:LIT) (“Lithium Australia” or the “Company”) is pleased to announce that its wholly owned subsidiary, Envirostream Australia Pty Ltd (“Envirostream”) – which is leading Australia’s battery recycling industry – has signed an exclusive 3-year recycling agreement (“Agreement”) with BYD Auto Industry Company Limited (“BYD Auto”), the automotive subsidiary of BYD Company Limited (“BYD Company”).

BYD Auto is a global leader in New Energy vehicles, having delivered a record ~3 million New Energy vehicles globally in 20231. BYD recently entered the Australian market in 2022, and have rapidly grown sales to account for

~14% of market share in Australia

BYD New Energy vehicles are equipped with the revolutionary Blade Battery, which uses lithium iron-phosphate (“LFP”) as the cathode material and offers a higher level of safety, durability, longevity and performance. BYD has been pioneering battery technology for over two decades, with the Blade Battery being a product of innovative research and development, and represents a major advancement in New Energy vehicles

This agreement aligns with Lithium Australia’s strategic plan to increase processing capacity of LFP batteries, as securing future LFP battery collections volumes will scale the Company’s LFP processing throughput.

The Agreement is not expected to materially change the current average revenue unit rates and average cost of sales unit rates as recently announced4. As such, the additional collection volumes are expected to generate further operating cash profits.

The Agreement is for an initial 3-year term, with a 2-year extension option. Under the Agreement, Lithium Australia will receive a service fee for the collection of BYD Auto’s end-of-life LFP batteries. The Company notes that customary termination rights exist on the occurrence of an insolvency event or any unremedied breach under the Agreement.

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Lithium Australia signs new exclusive battery recycling agreement with BYD Auto, source