GM to invest $650 million in lithium business to support EV growth
US President Joe Biden with General Motors CEO Mary Barra looks at a Chevrolet Silverado EV as he visits the 2022 North American International Auto Show at the Huntington Place Convention Center in Detroit, Michigan, on September 14, 2022. – Biden visits the auto show to highlight electric vehicle manufacturing.
Mandel Ngan | AFP | Getty Images
General Motors announced on Tuesday its intention to invest $650 million in Lithium Americas to secure access to lithium, a vital component of electric vehicle batteries.
It’s the biggest investment an automaker has ever made to secure the sources of raw materials that go into batteries, the companies said.
When the lithium is mined and processed from the Thacker Pass project, it will be enough for GM to manufacture up to one million electric vehicles a year.
Lithium is an essential component for battery packs because it has a very high energy density and resists charging and discharging well, according to GM and Lithium Americas.
“Sourcing critical electric vehicle raw materials and components directly from suppliers in North America and free trade agreement countries helps make our supply chain more secure, helps us manage cell costs and creates jobs,” GM President and CEO Mary Barra said in a statement. announcement of the investment.
Securing material sources is especially critical as GM seeks to ramp up production of electric vehicles. And in a letter to shareholders also released on Tuesday, Barra said 2023 would be “a breakthrough year” for its Ultium platform, which is the automakers’ battery platform for electric vehicles.
Barra said GM is on track to produce 400,000 electric vehicles from 2022 through the first half of 2023 in North America.
In exchange for its investment, GM will obtain exclusive access to the first phase of lithium production and the right of first offer on the second phase of lithium production that will come out of Thacker Pass in Nevada, which is the largest source of lithium that has been identified in the United States, according to GM and Lithium Americas.
Lithium production at Thacker Pass, located in northern Nevada, is expected to begin in the second half of 2026, the companies said, and will create 1,000 jobs during mine construction and 500 during operation.
“This is an exciting step, and we couldn’t ask for a better organization than General Motors to become our largest investor,” Lithium Americas President and CEO Jonathan Evans told CNBC. “GM shares our commitment to meaningfully advancing the energy transition, and I am confident that together we can make Thacker Pass a major player in a secure and integrated North American supply chain of critical battery materials. to electric vehicles.
GM’s $650 million will be delivered in two tranches. The first tranche money will be held in escrow pending the conclusion of a Minutes of Decision currently pending in the United States District Court.
Most recently, a hearing was held on January 5, 2023 in the United States District Court, District of Nevada, regarding an appeal of the release of the record of decision for the Thacker Pass project. On Jan. 6, Lithium America said the court had confirmed that no further hearings or briefings were required and that a final decision would be issued “within the next two months.”
The second part of GM’s money will be released when Lithium America’s U.S. and Argentina operations officially separate and when Lithium America has “sufficient capital” to be able to fully develop the Thacker Pass site, GM said.
—CNBC pippa stevens contributed to this report.