VW, Ford and Tesla batteries linked to destructive deforestation of indigenous lands

Mines in the supply chains of western carmakers are linked to widespread deforestation of primary rainforest in nickel-rich lands inhabited by the Tolaki people in Indonesia. An analysis has found that Volkswagen, Ford, and Tesla are among the electric carmakers whose batteries may contain nickel mined in indigenous woodlands plagued by deforestation, highlighting the struggle to make vehicles that are free from environmental destruction.

Corporate disclosures and trade flows from the last two years show that mines in the battery supply chains of automotive giants are linked to the loss of trees in Sulawesi, a wildlife hotspot in Indonesia that houses the world’s largest nickel deposits. The metal is widely used in cathodes in car batteries because it boosts energy density and increases range.

Ore from the Cahaya and Hengjaya mines was traced through regional smelters and Chinese processing plants run by Zhejiang Huayou Cobalt, a cathode manufacturer that supplies CATL, the world’s largest battery maker. Huayou’s corporate reports list US and European carmakers as end-users, while additional corporate files and trade data show a separate route from Huayou to LG, a South Korean group that also supplies battery products to leading carmakers, via Poland.

Satellite analysis shows that the mines have led to widespread deforestation of primary rainforest in nickel-rich lands inhabited by the indigenous Tolaki people. Wadimula, a Tolaki elder, stated,

“

“We used to ask the forest for protection in return for our offerings. Destroying it means destroying our own life.”

Electric vehicles are less environmentally harmful than fossil fuel-burning engines, which emit gases that foul the air and heat the planet. However, western carmakers have struggled to clean up supply chains for batteries built with critical minerals from Africa, Asia, and South America. Environmental groups warn that a failure to curb the boom of material-hungry SUVs is exacerbating the destruction by increasing the quantity mined.

Ore from the two mining concessions is sent to a nickel smelter in an industrial complex in Morowali, on Indonesia’s eastern coast, operated by Huayou’s local subsidiary. Here, limonite is refined into mixed hydroxide precipitate, the primary raw material used to make battery cathodes. In 2024, $606 million worth of mixed hydroxide precipitate was shipped from the Morowali plant to ports in China, followed by further shipments worth $470 million in 2025.