Stellantis announced that it will terminate its battery‑grade nickel and cobalt supply agreement with Alliance Nickel, effective December 3, 2025. The decision follows Alliance Nickel’s failure to meet several contractual milestones, including the completion of a definitive feasibility study and the securing of project financing for the NiWest development in Western Australia. The company cited the challenging global nickel market and the resulting financing constraints as the primary reasons for the missed milestones.
The termination signals a significant supply‑chain risk for Stellantis’ electrification roadmap. Nickel and cobalt are critical for the company’s expanding battery‑electric vehicle lineup, and the loss of a long‑term offtake could increase procurement costs or delay battery production if alternative suppliers are not secured promptly. Stellantis has indicated it is actively pursuing other sourcing options and is open to renegotiating terms with Alliance Nickel to preserve the strategic value of the NiWest project.
Alliance Nickel’s Managing Director, Paul Kopejtka, acknowledged the setback but emphasized the company’s willingness to renegotiate the offtake agreement. He noted that the depressed nickel price environment, driven largely by a surge in Indonesian production, has made it difficult to secure the necessary financing for the NiWest project, and that a revised agreement would better reflect the current market realities and the project’s development timeline.
The announcement triggered a negative market reaction for Alliance Nickel, reflecting investor concerns over the loss of a key offtake and the company’s financing challenges. Analysts highlighted that the termination could delay the project’s development and reduce its projected revenue streams.
The event underscores broader volatility in the battery‑materials supply chain. Nickel prices have fallen sharply in recent years, pressuring new projects and prompting several Australian producers to renegotiate supply contracts. Stellantis’ decision aligns with its broader strategy of securing raw‑material supply through direct investments, joint ventures, and diversified sourcing to mitigate price and availability risks.
Stellantis CEO Carlos Tavares has repeatedly stressed the importance of a robust, low‑carbon supply chain for meeting its 2030 electrification targets. The company’s willingness to renegotiate with Alliance Nickel demonstrates its commitment to maintaining control over critical material volumes while adapting to market conditions.
In summary, Stellantis’ termination of the Alliance Nickel agreement reflects a proactive response to supply‑chain headwinds. The company remains focused on securing alternative sources and is open to revisiting the NiWest partnership under terms that align with current market dynamics, thereby safeguarding its EV production schedule and cost competitiveness.
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