The limitation and increased cost of materials is causing a serious supply problem in the automobile industry. The lack of essential elements and resources is reducing the volume of manufacturing while driving up the price of cars. Ensuring production for the future is essential and for this reason manufacturers sign important guaranteed agreements like the one that GM has just sealed, securing enough lithium and cathodes to produce more than a million electric cars from 2025.
General Motors has ambitious electrification plans in the offing. Mary Teresa Barra, the company’s current boss, wants to scale electric mobility to all the group’s brands, although not for all models, because the Americans know that the access versions will continue to be thermal for many years. Although GM will not say goodbye completely to thermal engines, it does hope to expand the production of electric ones, and for that it needs resources.
Two important agreements are the ones he has signed in one fell swoop. The first of them is the lithium hydroxide supply guarantee for batteries for six years from 2025. A collaboration that has been agreed with the company Livent. Lithium is an abundant material, but its extraction and refinement is a somewhat more complex process. Not many companies take care of it, and today they are considered companies of high strategic value due to the role they already play in the industry, but above all because of the role they will play in the coming years.
The official agreement has been: “Livent will provide battery-grade lithium hydroxide to GM for a period of six years beginning in 2025. During the course of the agreement, Livent will increasingly supply battery-grade lithium hydroxide to GM from its US manufacturing facilities. The deal is expected to help secure supply for GM while helping Livent expand its capabilities in North America.”
In reference to the contract signed with LG Chem, it must be said that both companies have been working closely for some time under the joint venture: Ultium Cells. The Koreans provide battery cells to the Americans, and will continue to do so for years to come. Enough battery cathodes to produce more than five million electric cars between 2022 and 2030. An optimistic figure, but one that could be guaranteed thanks to the new agreements.
The official announcement has been: “Through the long-term supply agreement, LG Chem plans to supply more than 950,000 tons of CAM to GM from the second half of 2022 to 2030, enough to produce approximately more than five million electric cars. The GM-insured CAM will be used by Ultium Cells LLC, a joint venture between GM and LG Energy Solutions., at its battery cell plants in Warren, Ohio; Spring Hill, Tennessee; and Lansing, Michigan.