US President Joe Biden, with General Motors CEO Mary Barra, looks at a Chevrolet Silverado EV as he tours the 2022 North American International Auto Show at Huntington Place Convention Center in Detroit, Michigan on September 14, 2022. – Biden is visiting the auto show to highlight electric vehicle manufacturing.
Mandel Ngan | Afp | Getty Images
General Motors said on Tuesday it plans to invest $650 million into Lithium Americas to secure access to lithium, a vital component of batteries for electric vehicles.
It’s the biggest investment an automaker has ever made to secure sources of the raw materials that go into batteries, the companies said.
When the lithium is extracted and processed from the Thacker Pass project, it will provide be enough for GM to make as many as one million electric vehicles per year.
Lithium is a critical component for batteries batteries because it has a very high energy density and withstands charging and discharging well, according to GM and Lithium Americas.
“Direct sourcing critical EV raw materials and components 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 Chair and CEO Mary Barra said in a statement announcing the investment.
Securing sources of materials is especially critical as GM looks to ramp up production of EVs. And in a letter to shareholders also published on Tuesday, Barra said that 2023 would be “a breakout year” for its Ultium Platform, which the automakers battery platform for EVs.
Barra said GM is on track to produce 400,000 EVs from 2022 through the first half of 2023 in North America.
In exchange for its investment, GM will get 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, which is located in Northern Nevada, is due to begin in the second half of 2026, the companies said, and will create 1,000 jobs as the mine is being constructed and 500 during operations.
“It’s an exciting milestone, 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’m confident that together we can make Thacker Pass a major player in a secure, integrated North American supply chain from critical battery materials to EVs.”
The $650 million from GM will be delivered in two portions. The money for the first tranche will be held in escrow pending the conclusion of a Record of Decision ruling currently pending in U.S. District Court.
Most recently, there was a hearing on January 5, 2023 in the US District Court, District of Nevada, regarding an appeal of the issuance of the Record of Decision for the Thacker Pass project. On January 6, Lithium America said the court had confirmed there were no additional hearings or briefings required and that a final decision would be handed down “in the next couple months.”
The second portion of money from GM will be released when Lithium America’s US business and Argentinian businesses officially separate and when Lithium America has “sufficient capital” to be able to fully develop the Thacker Pass site, GM said.
— CNBC’s Pippa Stevens contributed to this report.
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