(Reuters) - General Motors Co (NYSE:GM) said on Tuesday it had signed multi-year agreements with LG Chem Ltd and Livent (NYSE:LTHM) Corp to secure key raw materials used in manufacturing batteries for electric vehicles.
With the latest deals, GM said it had lined up supplies for all battery raw materials, including lithium, nickel, cobalt and cathode active material, and was on course to reach its goal of producing 1 million EVs annually in North America by end-2025.
Nudged by the U.S. government and looking to get ahead in a booming market for EVs, automakers are striking deals to source key inputs for batteries, with an aim to localize the supply at some point.
LG Chem will supply GM with 968,000 tons of cathode material starting in the second half of 2022 through 2030, enough for about 5 million EVs, GM said.
Cathode material, made from processed nickel, lithium and other materials, represents about 40% of the cost of a battery cell, according to the company.
The automaker will receive battery-grade lithium hydroxide from Livent over six years starting 2025, with neither company specifiying the quantity.
In both the agreements, GM and the suppliers will work to localize production.
GM's announcement comes about a week after Ford Motor (NYSE:F) Co signed on China's CATL to import lower-cost lithium iron batteries. Ford said its various agreements cover 70% of the material it needs to make 2 million EVs annually by 2026. (https://reut.rs/3cGcVX0)