GM signs a deal with an Australian company to boost the EV supply chain

“The E25 facility will build in Louisiana is significant because it is expected [to] be the first plant in the United States to produce battery-grade manganese sulfate, a key component of cathode active material, which helps improve EV battery cell costs.”

The Louisiana site is expected to be 230,000 square feet, with work to prepare the site slated to start in the third quarter.

“GM’s support does more than accelerate our expansion in the United States,” Justin Brown, Element 25’s managing director, said in a statement. “Together, we are creating a resilient and sustainable North American supply chain that will help introduce millions of customers to the performance and environmental benefits of EVs.”

GM has said it has reached deals with suppliers to secure all of the necessary battery materials to produce 1 million EVs in North America in 2025. The automaker plans to have capacity to build that many EVs per year by then.

The automaker is working to line up the battery raw materials it will need for electric vehicle production from 2026 to 2032. The Element 25 agreement covers that time frame.

GM has been working to increase its sourcing of battery raw materials outside of China for a couple of years, drawing on lessons learned during the semiconductor shortage about having a diverse supply chain, Kunjur said.

The federal Inflation Reduction Act has made that work more critical, he said. The IRA provides a tax credit of up to $7,500 for the purchase of electric vehicles, though it also establishes new requirements for sourcing and processing of raw minerals from the US or from countries in which the US has a free-trade agreement.

“Manganese in today’s chemistry is a relatively smaller percentage in comparison to nickel or lithium, but we think there are alternative chemistry that are being developed that will become more manganese-dependent,” Kunjur said. “So this is not only to secure what we have in our portfolio today, but also to future-proof it for tomorrow’s chemistry.”

Beyond Element 25, GM has invested in and signed agreements with other companies in the battery supply chain, including securing raw materials for EV batteries, processing, cell production and recycling.

Kunjur said GM is working to expand the volume of battery minerals in its supply chain as it moves toward a goal of an all-electric light-vehicle portfolio in North America by 2035.

“Canada is especially rich in all of these elements, so we are working actively with Canadian companies. We are actively working with American companies. We are also beginning to explore possibilities in Mexico,” he said. “There’s more to come as we build out this near-shore value chain.”

GM has invested more than $7 billion in three Ultium Cells battery plants with joint venture battery partner LG Energy Solution. The first, in Warren, Ohio, has started production, while a second plant in Spring Hill, Tenn., is expected to open this year. A third plant, near Lansing, Mich., is expected to open in 2024.

The automaker said it will invest more than $3 billion to build its fourth battery plant, its first with joint venture partner Samsung SDI, in northern Indiana. Production there is expected to start in 2026.