Lithium Americas Corp. and General Motors (GM) have entered into a new investment agreement to establish a joint venture for the purpose of funding, developing, constructing and operating Thacker Pass in Humboldt County, Nev., the company announced Oct. 16.
The JV transaction will deliver $625 million of cash and letters of credit from GM to Thacker Pass, alongside the conditional commitment for a $2.3 billion US Energy Department (DOE) loan announced earlier in 2024 for developing the facility.
Under the terms of the investment agreement, GM plans to acquire a 38% asset-level ownership stake in Thacker Pass for $625 million in total cash and letters of credit, including $430 million of direct cash funding to the JV to support the construction of phase one and a $195 million letter of credit facility that can be used as collateral to support reserve account requirements under the DOE loan.
It further said that the new JV transaction replaces the $330 million tranche 2 common equity investment commitment from GM under its original investment agreement with Lithium Americas as announced in January 2023.
Even as the transaction is the largest-ever publicly announced investment by a US original equipment manufacturer in a lithium carbonate project, the move highlights the strategic importance of Thacker Pass in creating a domestic supply chain for critical minerals for local production of electric vehicle batteries. After the transaction is executed, Lithium Americas will have a 62% interest in Thacker Pass and will manage the project on behalf of Lithium Americas and GM.
“Our relationship with GM has been significantly strengthened with this joint venture as we continue to pursue a mutual goal to develop a robust domestic lithium supply chain by advancing the development of Thacker Pass,” said Jonathan Evans, president and CEO of Lithium Americas. “The JV announcement is a win-win for GM and Lithium Americas. GM’s JV Investment demonstrates their continued support and helps us to unlock the previously announced $2.3 billion DOE Loan. We will be working closely with GM to advance towards the final investment decision, which we are targeting by the end of the year.”
“We’re pleased with the significant progress Lithium Americas is making to help GM achieve our goal to develop a resilient EV material supply chain,” said Jeff Morrison, senior vice president, Global Purchasing and Supply Chain at GM. “Sourcing critical EV raw materials, like lithium, from suppliers in the U.S., is expected to help us manage battery cell costs, deliver value to our customers and investors, and create jobs.”
