To reduce the cost of batteries for EVs further, BMW will focus on improving its battery design and recycling to rather than mining, said finance chief Nicolas Peter in an interview with Reuters.

The company's approach is different from some of its competitors, such as Volkswagen and Mercedes-Benz, which are investing in mines to secure control of scarce supply of minerals required for EV battery production.

Volkswagen has a battery supplier subsidiary called PowerCo. The company is investing into Canadian mining companies.

"The bottleneck for raw materials is mining capacity - that's why we need to invest in mines directly," said Thomas Schmall, Volkswagen's board member for technology, in an interview with Reuters.

Mercedes-Benz CEO Ola Kaellenius has also said that the company is willing to invest in mines. The company has setup a raw materials office in Canada.

"We have fundamentally made the decision that if a deep sourcing opportunity presents itself down to the mine, we are able and willing to allocate capital to that," said CEO Kaellenius at the company's annual environmental, social and governance conference last week.

BMW however, thinks that going down the mining path will make it no different from an oil company.

"We don't think it is right to invest in mines. We view it as more important to get back raw materials from cars and other products," said BMW's CFO Peter.

The biggest portion of a battery’s cost is raw minerals, which like oil, is a finite resource that takes a lot of energy to mine, refine, and transport.

Instead of doing even more mining activities, BMW wants to prove that there is demand for recycled raw materials via the sales growth of its electric cars and it will work with battery recycling specialists to scale up their business, thus creating more capacity for battery recycling.

"With our business development, we are creating the motivation to invest -- but we do not need to develop big recycling facilities for battery cells ourselves."

Battery recycling looks like a greener path but it is not without challenge. Battery recycling only works well in theory. In reality, it is extremely difficult to extract minerals from a used battery, due to complex disassembly required and difficulties in separating minerals from a battery cell. The cost is also very high, which explains why companies like Volkswagen and Mercedes-Benz see investing in mining as a more logical solution.

Closer to home, BMW Group Malaysia is one of the few, if not the only car company here to do high voltage battery recycling. Spent lithium-ion PHEV and BEV batteries are recycled by BMW’s battery recycling partner SungEel HiTech, which has a plant in Penang.

BMW also plans to bring down costs by investing in technologies requiring fewer critical raw minerals, such as hydrogen-powered cars, which it is developing in partnership with Toyota.

Also read: After BEVs, BMW calls the Toyota-powered iX5 hydrogen FCEVs the missing jigsaw piece in carbon neutrality