The Trump administration has acquired a 5% equity stake in Lithium Americas, plus another 5% in the company’s joint venture with General Motors, marking the federal government’s latest move to secure domestic lithium supplies. The Department of Energy announced the strategic investment yesterday, positioning the United States to directly benefit from what will become the Western Hemisphere’s largest lithium mine when Thacker Pass begins production in 2028.
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Strategic Investment in Critical Mineral Supply Chain
The Department of Energy’s equity position represents a significant shift in how the U.S. government approaches critical mineral security. Energy Secretary Chris Wright told Bloomberg Television that the government needed to take an ownership stake to “ensure the mine’s viability as lithium prices drop worldwide.” This investment builds on the $2.26 billion loan agreement Lithium Americas secured from the Biden administration in October 2024, which was recently restructured to include more than $100 million in new equity.
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The Thacker Pass project is projected to produce approximately 40,000 metric tons of lithium carbonate annually once fully operational, dramatically increasing domestic production capacity. Currently, the United States produces less than 5,000 metric tons of lithium annually, according to the U.S. Geological Survey. By comparison, China—the world’s third-largest lithium producer after Australia and Chile—already produces 40,000 metric tons annually, highlighting the strategic importance of developing domestic sources.
Geopolitical Implications and Battery Supply Chain Security
This investment represents the Trump administration’s continued push to reduce American dependence on foreign critical minerals, particularly from China. Lithium serves as a crucial component in batteries for electric vehicles, renewable energy storage systems, and consumer electronics. The Department of Energy’s Battery Materials Processing and Manufacturing Funding Opportunity has previously highlighted the strategic importance of securing domestic lithium supplies.
The administration has pursued similar strategic investments in other critical sectors. In August, Intel announced the U.S. government would take a 10% stake in the company, while MP Materials revealed in July that the Department of Defense would become its largest shareholder with a 15% stake. These moves align with the Executive Order on America’s Supply Chains that emphasized reducing reliance on potentially adversarial nations for essential materials.
Environmental and Indigenous Community Concerns
The Thacker Pass project has faced significant opposition from environmental groups, ranchers, and Native American tribes since its inception. A February 2025 report from Human Rights Watch and the American Civil Liberties Union found that the federal government’s permitting process violated Indigenous peoples’ rights, alleging failure to obtain “free, prior, and informed consent” from affected tribes.
Environmental organizations have raised concerns about the mine’s potential impact on local water sources and endangered species, including the greater sage-grouse. The Bureau of Land Management’s environmental impact statement acknowledged these concerns while concluding the project could proceed with mitigation measures. Construction has continued since 2023 despite ongoing legal challenges and protests from conservation groups and tribal communities.
Market Impact and Future Outlook
The government’s equity stake comes as global lithium prices have declined from 2022 peaks, creating financial challenges for new mining projects. According to BloombergNEF analysis, lithium carbonate prices have fallen approximately 70% from their 2022 highs, making government support crucial for projects like Thacker Pass to reach production.
Once operational, Thacker Pass could supply enough lithium for approximately 800,000 electric vehicles annually, significantly boosting North America’s battery manufacturing capacity. The project’s success is considered vital for meeting the growing demand from automakers like General Motors, which has committed to exclusively offering electric vehicles by 2035. The mine’s development timeline positions it to begin production as electric vehicle adoption is expected to accelerate significantly in the late 2020s.
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