GM Announces Deals to Strengthen EV Supply Chain
DETROIT – General Motors today announced two projects intended to bolster the electric-vehicle supply chain as it ramps up its EV portfolio.
GM and VAC of Germany announced plans for VAC to build a new plant in the U.S. that will manufacture permanent magnets for electric motors used in the GMC Hummer EV, Cadillac LYRIQ, Chevrolet Silverado EV and more than a dozen other models using GM’s Ultium Platform. The new plant would plan to use locally sourced raw materials.
Ultium Cells LLC, a joint venture between GM and LG Energy Solutions, in currently building a $2.3 billion EV battery manufacturing plant in Lordstown. Construction of a second Ultium plant is also underway in Spring Hill, Tenn.
VAC is a global producer of advanced magnetic materials and the largest producer of permanent magnets in the Western Hemisphere with nearly 100 years of experience.
“We are building a resilient and sustainable EV manufacturing value chain in North America from raw materials to components to drive GM’s growth and support a mass market for EVs,” said Shilpan Amin, GM vice president, global purchasing and supply chain. “Our work with VAC is another bold step forward that will help ensure that we meet our goal to lead the EV industry in North America in more than just sales,” he said.
“We are thrilled to join forces with GM on this journey into an increasingly electrified world, leveraging sustainable clean energy solutions. As VAC’s Permanent Magnet Division is the only industrial scale producer of rare earth permanent magnets in the Western Hemisphere, VAC brings reliable scale and experience to GM’s supply chain. VAC’s deep magnetic materials knowledge and extensive e-mobility technology expertise, in partnership with GM, will enable a cleaner global future for our communities,” said Dr. Erik Eschen, CEO of VAC.
The plant is expected to start production in 2024 and create hundreds of new jobs. The location of the facility will be announced at a later date. The finished magnets will be delivered to facilities building EV motors for GM’s Ultium-powered EVs.
GM also announced Thursday that it has entered into long-term agreement with MP Materials to supply the automaker with rare earth materials, alloy and finished magnets for electric motors.
MP Materials intends to build a new production facility in Fort Worth, Texas, using materials sourced from its rare earth mine in Mountain Pass, Calif., the only active and scaled rare earth production site in North America. Rare earth materials sourced from Mountain Pass will be transformed into metal, alloy and magnets at the new Fort Worth facility.
“Restoring the full rare earth supply chain to the United States at scale would not be possible without U.S. manufacturers like GM recognizing the strategic consequence and acting with conviction,” said MP Materials Chairman and CEO James Litinsky in a statement. “We are proud to welcome GM as the foundational automotive customer for our new magnetics facility and join forces with a company fully aligned with our vision to reinvigorate the American manufacturing spirit.”
Rare earth materials are a collection of 17 elements that contain magnetic properties and are vital to the production of EV batteries and other products, such as smart phones and missile systems.
GM and MP Materials have signed a binding agreement on terms and expect to enter into a definitive supply agreement shortly. In addition, the two companies will work together to seek public policies that are supportive of a secure, U.S. rare earth supply chain.
China is currently the world’s dominant supplier of rare earth materials. According to the U.S. Geological Survey, China was responsible for 80% of rare earth imports in 2019.
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