Recycling & Circularity Developed 2025 · C14 4 min
From Europe to Africa: Stellantis Investment in Battery Circularity in an Emerging Market
Battery circularity in Africa is emerging as a strategic frontier for the global EV supply chain. The continent holds abundant reserves of critical minerals including cobalt, lithium, manganese and graphite, and as Europe and the United States work to de-risk their raw material supply chains away from China, Africa's position strengthens. This case study examines how Stellantis, the global automaker formed by the 2021 merger of Fiat Chrysler Automobiles and Groupe PSA, could invest in battery reuse and recycling capabilities in an emerging market.
The Strategic Context
Stellantis owns 14 automotive brands and operates in more than 30 countries. Its Middle East and Africa strategy sits within the Dare Forward 2030 vision, which emphasises sustainable and accessible mobility. The region has a population of around two billion and roughly four million new car sales annually, with strong potential in micro-electromobility that bridges the gap between two-wheelers and pre-owned vehicles. Morocco anchors this strategy. The Kenitra manufacturing plant, backed by over 300 million euros and a partnership with the Moroccan government since 2015, already produces urban mobility models such as the Citroen AMI, Opel Rocks-e and Fiat Topolino, with plans to double capacity and contribute to a regional goal of one million vehicles a year by 2030 with 70 percent local production autonomy.
Why Circularity Matters Now
As attention turns to the environmental impact of EVs, particularly end-of-life batteries, closed-loop production is becoming a priority. Battery circularity spans two pathways. Reuse covers repurposing, where suitable packs are combined by residual state and capacity, and refurbishment, where packs are disassembled and cells reconditioned into new modules. Recycling extracts critical materials such as lithium, nickel, cobalt, manganese and copper and returns them to the supply chain. Second-life batteries typically retain 70 to 80 percent state of health, making them valuable for stationary storage such as microgrids and industrial backup rather than premature recycling. Monetising them creates an additional revenue stream and raises the residual value of used EVs.
The Investment Scenarios
The case asks a senior Stellantis executive in the Middle East and Africa region to choose among three scenarios. The first is a vertically integrated circular battery hub in Morocco, carrying high capital expenditure, high control and a long-term strategic horizon. The second is a joint venture or consortium with local and global partners across Africa, with moderate capital, shared risk and flexible planning. The third is no investment for now, business as usual. Each is judged on a risk-return basis, alongside questions about the feasibility of moving end-of-life batteries outside Europe, the regulatory risks involved, and whether North Africa or Sub-Saharan Africa offers the better location for a circular economy hub.
Challenges and Competitive Moves
The reuse and recycling market faces real friction. Collection, transportation, inspection, disassembly, sorting and regrouping all add cost, and the supply of end-of-life EV batteries remains limited, keeping the reuse market small. Cross-border movement of batteries raises regulatory and liability questions about who handles transport between jurisdictions. Safety is critical, since mishandled batteries pose fire hazards to the communities hosting service centres, and the technical skills to manage them are unevenly distributed. Competitors are already positioning. The case notes that Romco Group and Elemental Group have agreed to collaborate in West Africa, while Hinckley E-Waste Recycling announced a five million dollar investment in a lithium-ion and lead-acid recycling facility in the region. OEMs can unlock value by partnering with repurposers, supplying end-of-life batteries at lower cost and designing simpler battery assemblies, supported by portable in-vehicle testing tools.
What It Means for the Industry
The case shows Africa's potential to move beyond raw material extraction toward refining, manufacturing and circularity. For an automaker, circularity is both an environmental commitment and a route to secure secondary raw materials and new revenue. Morocco's existing manufacturing base, policy support and proximity to European and US markets make it a credible pilot location, but the choice between full integration and partnership depends on tolerance for capital risk against the value of control.
Key Takeaways
Africa's critical mineral reserves and friendshoring pressure position it as a rising EV supply chain and circularity hub.
Stellantis's Kenitra plant in Morocco, backed by over 300 million euros, anchors its regional and micro-mobility strategy.
Second-life batteries retain 70 to 80 percent state of health, suited to stationary storage before recycling.
Three scenarios weigh a vertically integrated Moroccan hub, a joint venture, or no investment, on a risk-return basis.
Cross-border battery movement raises regulatory, liability and safety questions that shape feasibility.
Competitors such as Romco, Elemental and Hinckley are already investing in West African recycling.
OEMs can gain revenue and secure secondary materials by partnering with repurposers and simplifying battery design.
Disclaimer: This case study was developed and presented by BatteryMBA participants as part of the Case Study Track. Views, analysis and recommendations are the authors' own. BatteryMBA does not take responsibility for the accuracy or completeness of the content and it should not be relied upon as investment, engineering or legal advice.
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