Mercedes-Benz Group and Stellantis are in discussions with Serbia’s government to invest in lithium-processing and EV battery production, potentially adding fresh support for what may become Europe’s biggest lithium mine.

The carmakers, who are already partners in a battery joint venture, are willing to follow Rio Tinto Group’s investment in the $2.4-billion mine in Serbia by developing processing and EV battery output, according to people familiar with the situation. The discussions are a step forward in reviving the project, which was blocked by Serbia two years ago following local protests.

Spokespeople for Mercedes and Stellantis declined to comment.

Creating a broader lithium industry — rather than just exporting the raw material — has been a key demand of the Serbian government in backing the Jadar project. The European Union is wholly reliant on imports of the commodity used to make batteries. The bloc has pursued the development of its own EV supply chain to ease dependence on imports from Asia, though the faltering shift to EVs has seen a range of cell-making projects put on the back burner.

This includes Mercedes and Stellantis, who have put on hold two of their three battery plants in Europe, set to cost a total of €7-billion, after vehicle demand fell short of expectations. Even if European battery champions emerge, the industry remains dependent on a raw materials and processing supply chain that’s dominated by China.

Serbia will sign a framework agreement with the EU on mineral raw materials on Friday, Serbia’s President Aleksandar Vucic told reporters late Wednesday. The initial pact sets out the establishment of a processing industry as well battery making, Vucic said, and ensuring production of materials as well as EVs would qualify for sale in the EU without attracting levies.

Executives from the two car companies are set to be in Serbia on Friday, when German Chancellor Olaf Scholz visits the country, and may sign letters of intent to develop the country’s industry, the people said, declining to be named discussing private information.