General Motors Chairman and CEO Mary Barra appears via live broadcast as she delivers a keynote address digitally at CES 2022 in Las Vegas, Nevada on January 5, 2022 .
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Detroit- General Motors The companies announced Wednesday that they have agreed to form a joint venture with Lithium Americas Corp. in which the automaker will provide $625 million in cash and credit to the Canadian miner.
The transaction focuses on the development, construction and operation of a lithium carbonate mining operation called Thacker Pass in Humboldt County, Nevada. Lithium is a key component of electric vehicle batteries.
Obtaining raw materials such as lithium from the United States is critical to GM’s plan to profitably grow its all-electric vehicle business and meet stringent federal incentives to produce and sell the cars and the large batteries they require. .
“We are pleased with the significant progress Americas Lithium is making in helping General Motors achieve its goal of developing a resilient electric vehicle materials supply chain,” said Jeff Morrison, GM’s senior vice president of global procurement and supply chain. said in a press release. “Sourcing critical electric vehicle raw materials such as lithium from U.S. suppliers is expected to help us manage battery costs, create value for customers and investors, and create jobs.”
General Motors and Lithia Americas Stock
The news sent Lithium Americas’ shares up about 10% to about $3 in early trading Wednesday. The agreement, which was previously announced as an equity deal, saw shares rise more than 20% during premarket trading.
General Motors will own 38% of Thacker Pass, according to the release. The joint venture investment is expected to include a cash contribution of $330 million at closing; $100 million in cash at the time of a “final investment decision” on one phase of the project; and $195 million prior to the first drawdown of the $2.3 billion Department of Energy loan. letter of credit financing.
Jonathan Evans, CEO of Lithium Americas, said: “Through this joint venture, our relationship with General Motors has been significantly strengthened as we continue to pursue our shared goal of developing a strong domestic lithium supply chain by advancing the development of Thacker Pass. said in a press release.
The joint venture complements GM’s $320 million investment in Lithium Americas in February 2023.
In August, General Motors and Lithium Americas agreed to delay Second phase investment Mining rigs worth $330 million to explore alternative investment structures.
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