Novonix (ASX) has signed a significant offtake agreement with global automotive manufacturer Stellantis NV. Under this binding agreement, Novonix will supply at least 86,250 tonnes of high-performance synthetic graphite, with the ability to increase volumes up to 115,000 tonnes, over a six-year period from 2026 to 2031. This graphite will be essential to supporting the North of Stellantis. American battery cell manufacturing as the company advances its strategy to fully transition to battery-electric passenger vehicles.
Headquartered in Brisbane, Australia, Novonix develops and manufactures critical anode materials for lithium-ion batteries. The company’s technologies aim to improve the performance, durability and sustainability of batteries. Novonix’s operations include the Riverside plant in Chattanooga, Tennessee, which is expected to begin commercial production in 2025. This plant, initially producing 20,000 tons per year, will be the first large-scale synthetic graphite production site of North America dedicated to the battery sector. . This project is supported by a $100 million grant from the U.S. Department of Energy and a $103 million investment tax credit.
Stellantis NV, created from the 2021 merger of the PSA Group and Fiat Chrysler Automobiles, is one of the largest automotive manufacturers in the world. With renowned brands such as Jeep, Dodge, Peugeot and Citroën, the company is investing aggressively in its electrification roadmap as part of its goal to achieve carbon neutrality by 2038. Stellantis has committed over 30 billion euros in electrification and software development by 2025.
Chris Burns, CEO of Novonix, highlighted the impact of the partnership: “We are thrilled to have the commitment of Stellantis, now our largest customer, to support their electric vehicle growth plans in North America. This contract allocates the remainder of our available volumes at our Riverside facility and a portion of the volumes to be produced at our planned greenfield facility.
To meet growing demand, Novonix is also seeking additional funding from the U.S. Department of Energy’s Lending Program Office to develop a new greenfield manufacturing facility in the southeastern United States. This plant is expected to start with an annual production capacity of 30,000 tonnes, scalable up to 75,000 tonnes.
The agreement with Stellantis is based on a market-oriented pricing structure and includes clauses that require Novonix to meet production milestones and comply with specific standards. If Novonix does not comply with these conditions, Stellantis reserves the right to terminate the contract.
Novonix shares are trading up 17.36% at 84 cents.