Electric Vehicles Battery Recycling Market Gains Momentum as Redwood Materials Closes US$425 Million Funding Round

Market Size and Growth 2026

Redwood Materials closed a US$425 million Series E funding round in January 2026 to accelerate its energy storage platform while strengthening its integrated battery recycling and critical minerals business. The investment supports a business model that connects end-of-life battery collection, material recovery, refining, and second-life energy storage. This approach is commercially relevant to the electric vehicles battery recycling market because it creates additional value from used battery packs before their materials are recovered for reuse. As battery manufacturers and automotive companies seek more resilient sources of lithium, nickel, cobalt, and copper, investments that connect recycling with downstream applications are helping establish circular battery supply chains.

Companies including Redwood Materials, Li-Cycle, Umicore, Fortum, and GEM Co., Ltd. operate across battery recycling, materials recovery, and processing technologies. Their commercial opportunities include recovering battery-grade materials, processing manufacturing scrap, building collection networks, and entering closed-loop supply agreements with automakers and cell manufacturers. However, recyclers face pressure to control processing costs, secure consistent feedstock, and compete with virgin materials when commodity prices decline. Companies able to combine safe battery handling with efficient recovery and reliable material quality are better positioned to serve battery producers seeking traceable, localized supplies.

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According to DataM Intelligence, the global Electric Vehicles Battery Recycling Market was valued at US$1.61 billion in 2025 and is projected to reach US$172.86 billion by 2035, growing at a CAGR of 43.67% during 2026-2035. The report identifies battery type, vehicle type, recycling process, application, and region as the market's main segmentation dimensions. Growth is associated with expanding electric-vehicle adoption, rising future volumes of retired battery packs, demand for critical minerals, and the development of recycling infrastructure.

Key Developments 2025-2026:

United States: Recent Industry Developments
✅ In October 2026, Rivian and Redwood Materials expanded their partnership to cover the full lifecycle of EV batteries. Redwood will recycle Rivian's battery manufacturing scrap and end-of-life battery packs, while assessing suitable batteries for reuse in stationary energy storage. The agreement strengthens circular battery management and supports the recovery of valuable materials for future battery production.

✅ In September 2026, R3 Lithium began operations at its battery recycling facility in Covington, Georgia. The 154,000-square-foot plant is designed to produce lithium carbonate from recycled battery materials, supporting the recovery of critical minerals for domestic battery supply chains. The company also announced $15 million in Series A funding to advance commercial operations.

✅ In September 2026, Nth Cycle signed a 10-year, $1 billion offtake agreement with Glencore for recycled battery materials. The agreement covers approximately 24,000 metric tons of battery black mass annually, which Nth Cycle will process to recover lithium carbonate and nickel-rich materials. The deal highlights growing commercial interest in domestic EV battery recycling and critical-mineral recovery.

✅ In August 2026, the U.S. Department of Energy selected Nth Cycle to enter award negotiations for up to $100 million in support of a proposed critical-mineral refining facility. The planned Southeast U.S. facility is designed to process up to 24,000 metric tons of battery black mass annually. It aims to recover battery-grade lithium carbonate and nickel materials for domestic manufacturing and energy supply chains.

✅ In June 2026, General Motors expanded its battery lifecycle partnership with Redwood Materials. The companies announced plans to deploy approximately 100 repurposed GM battery packs in a 1.5 MW, 7.2 MWh energy storage system at a Michigan manufacturing facility. The collaboration combines battery recycling, critical-mineral recovery and second-life battery applications, extending the value of EV batteries beyond vehicle use.

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Japan: Recent Industry Developments
✅ In September 2026, Sumitomo Metal Mining held the completion ceremony for its commercial-scale battery recycling plant in Ehime Prefecture. The facility can process battery materials equivalent to approximately 10,000 metric tons of battery cells annually, recovering lithium, nickel, cobalt and copper. The project marks a significant development in Japan's domestic recycling infrastructure for EV and other lithium-ion batteries.

✅ In August 2026, Green Coop, Hino Motors, Toyota Tsusho and NEXTES began considering a demonstration project to reuse batteries from electric delivery trucks. The initiative aims to repurpose used lithium-ion batteries into stationary energy storage systems rather than immediately sending them for material recycling. The project could support more efficient battery resource utilization and expand second-life applications in Japan.

✅ In June 2026, SBS Holdings, Toshiba and Drive Electro Technology launched a demonstration integrating reused EV batteries with ultra-fast charging for commercial electric trucks. Toshiba supplied reused SCiB lithium-ion batteries for stationary energy storage at a Tokyo logistics site. The project will assess whether battery reuse and integrated charging systems can improve fleet operations and reduce infrastructure constraints.

✅ In May 2026, Sumitomo Metal Mining and Sumitomo Corporation agreed to study a battery recycling supply chain spanning Australia, New Zealand and Japan. The proposed model involves collecting used lithium-ion batteries, processing them into black mass in Oceania, and recovering valuable metals at Sumitomo Metal Mining's Japanese facilities. The initiative aims to establish a cross-border circular supply chain for critical battery materials.

List of Key Players 2026:

=> GEM Co., Ltd., Eramet, Li-Cycle Corp, Fortum, Umicore, Redwood Materials Inc., Shenzhen Highpower Technology Co., Ltd., ACE Green Recycling, Inc., Stena Metall AB, ACCUREC-Recycling GmbH.

Redwood Materials: Redwood Materials operates across battery recycling, critical-mineral recovery, refining, and second-life energy storage. Its US$425 million Series E funding round, closed in January 2026, is intended to accelerate energy storage while strengthening its integrated materials business. Partnerships with General Motors and Rivian demonstrate how the company is connecting battery collection and recycling with reuse applications and industrial energy storage.

Li-Cycle Corp.: Li-Cycle is a battery resource recovery company focused on processing lithium-ion battery materials and producing intermediate products for further refining. Its position in the market is tied to the ability to handle battery feedstock safely and recover materials that can return to the battery supply chain. Commercial performance depends on processing economics, access to feedstock, operating reliability, and the ability to deliver recovered materials that meet customer requirements.

Umicore: Umicore operates in materials technology and recycling, including battery-material recovery and the circular use of metals. Its relevance to EV battery recycling comes from its expertise in recovering valuable metals and connecting recycling processes with materials supply chains. Demand for traceable recovered materials and more localized sourcing creates opportunities for established refiners, while cost-effective processing and consistent output quality remain important competitive requirements.

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Growth Forecast Projection 2026:

The Global Electric Vehicles Battery Recycling Market is anticipated to rise at a considerable rate during the forecast period, between 2026 and 2035. In 2025, the market is growing at a steady rate, and with the rising adoption of strategies by key players, the market is expected to rise over the projected horizon.

How Our Market Research Process Works:

The global Electric Vehicles Battery Recycling Market research report is developed using a comprehensive combination of primary and secondary data sources. The study evaluates a wide range of industry-influencing factors, including government regulations, evolving market dynamics, competitive intensity, and historical performance trends. It also analyzes technological advancements, emerging innovations, and developments across related industries. In addition, the report assesses market volatility, growth opportunities, potential barriers, and key challenges that could impact the future expansion of the Electric Vehicles Battery Recycling ecosystem.

Recent Mergers & Acquisitions (M & A) 2025-2026:

✅ September 2026 - Ecobat completed the sale of its lithium-ion battery recycling operations and assets in Casa Grande, Arizona, marking its exit from lithium recycling and enabling the company to focus on its North American lead battery recycling business. The buyer and financial terms were not disclosed.

✅ July 2026 - Cylib acquired a mechanical processing facility in Wernberg-Köblitz, Bavaria, Germany, with an annual capacity of up to 10,000 tonnes of end-of-life electric vehicle batteries, strengthening its integrated recycling capabilities from battery dismantling and black mass production to critical material recovery.

✅ May 2026 - Clarios completed the acquisition of three battery recycling facilities from Ecobat in Germany and Austria, expanding its European recycling network and strengthening its closed-loop battery supply chain through improved recovery of lead and polypropylene. Note: This transaction primarily concerns lead-acid battery recycling, rather than lithium-ion EV battery recycling

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Major Focused Key Segmentations 2026:

➥ By Battery Type: Lithium Nickel Manganese Cobalt (NMC), Lithium Iron Phosphate (LFP), Lithium Titanate Oxide (LTO), Lithium Manganese Oxide (LMO), Lithium Nickel Cobalt Aluminum Oxide (NCA)

➥ By Vehicle Type: Passenger Cars, Commercial Vehicles, Two-Wheelers, Others

➥ By Process: Hydrometallurgical, Pyrometallurgical, Mechanical, Others

➥ By Application: Electric Vehicles, Energy Storage Systems, Consumer Electronics, Others

➥ By Region: North America (U.S., Canada, Mexico), Europe (Germany, UK, France, Italy, Spain, Rest of Europe), South America (Brazil, Argentina, Rest of South America), Asia-Pacific (China, India, Japan, Australia, Rest of Asia-Pacific), Middle East & Africa

We Provide Benefits of the Report:

Chapter 1: Lays the foundation by defining the scope of the report, highlighting core market segments across regions, product types, and applications. It delivers a clear snapshot of current market size, growth potential, and how the industry is expected to evolve in both the near and long term.

Chapter 2: Spotlights the most impactful market insights, unveiling the transformative trends and forces shaping the future of the industry.

Chapter 3: Provides a deep dive into the competitive landscape of , covering revenue shares, strategic initiatives, and notable mergers & acquisitions that are reshaping the market.

Chapter 4: Presents detailed company profiles of leading players featuring financial performance, product portfolios, profit margins, and key milestones that set them apart in the industry.

Chapters 5 & 6: Break down revenue analysis at both regional and country levels, offering precise data on market size, growth drivers, and expansion opportunities across global markets.

Chapter 7: Analyzes the market by product type, spotlighting segment-specific opportunities and helping stakeholders identify untapped, high-growth areas.

Chapter 8 :Explores the market through application-based segmentation, assessing demand across industries and pinpointing downstream sectors with the strongest potential for growth.

Chapter 9: Maps the industry's supply chain in detail, tracing upstream and downstream activities to provide clarity on value creation across the ecosystem.

Chapter 10: Wraps up with a concise summary of the report's key insights distilling the most critical findings and strategic takeaways for decision-makers and stakeholders.

FAQ

Q1: What is the current size of the Electric Vehicles Battery Recycling Market?

A: The Electric Vehicles Battery Recycling Market was valued at USD 1.61 billion in 2025 and is forecasted to hit USD 172.86 billion by 2035

Q2: How rapidly will the Market expanding?

A: The Electric Vehicles Battery Recycling market is projected to grow at a CAGR of 43.67% between 2026 and 2035.

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