General Motors Company (NYSE:GM) will invest $625 million into a joint venture with Lithium Americas Corp (TSX:LAC, NYSE:LAC) to advance the Thacker Pass lithium carbonate mine in Humboldt County, Nevada.
GM will acquire a 38% interest in the project by committing $625 million in cash and letters of credit while Lithium Americas will contribute $387 million in funding for 62% ownership in the project.
This funding is on top of a conditional commitment of a $2.3 billion loan from the US Department of Energy, announced earlier this year.
“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,” Lithium Americas CEO Jonathan Evans said in a statement.
“We will be working closely with GM to advance towards the final investment decision, which we are targeting by the end of the year.”
Securing domestic sources of lithium is key to GM’s EV strategy.
“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,” Jeff Morrison, GM senior vice president of global purchasing and supply chain, commented.
“Sourcing critical EV raw materials, like lithium, from suppliers in the US, is expected to help us manage battery cell costs, deliver value to our customers and investors, and create jobs.”
Shares of Lithium Americas surged almost 20% to $3.20 on the announcement. GM traded up 2.2% at $48.90.