General Motors has inked a deal with rare earth mining and manufacturer MP Materials Corp. to produce alloy and magnets for the automaker’s upcoming electric vehicles.
On Thursday, GM said it has signed a long-term agreement which solidifies the terms of a binding agreement announced by MP Materials and the automaker in December. MP Materials, which is based in Las Vegas, broke ground Thursday on the construction of an alloy and magnet manufacturing plant in Fort Worth, Texas, that will supply GM EV materials.
MP Materials will supply rare earth materials, mined and manufactured in the U.S., such as alloy and finished magnets. They will be used in the electric motors on “more than a dozen” of GM’s EVs using GM’s Ultium platform, the battery system that will power GM’s EVs.
The first material to be produced will be alloy, starting late next year, GM and MP said in a joint statement.
The materials made at the new Texas plant will add to GM’s efforts to have an EV supply chain based largely in North America, providing raw materials to components for GM’s EVs. GM has said it will bring 30 new EVs to market by 2025 and it has said it will sell 1 million EVs globally by mid-decade.
“The new MP Materials magnetics facility in Fort Worth, Texas, will play a key role in GM’s journey to build a secure, scalable and sustainable EV supply chain,” Anirvan Coomer, GM’s executive director of Global Purchasing & Supply Chain, said in a statement.
Coomer said GM is “the foundational automotive customer of the Fort Worth facility” and it will use the alloy and other products made at the plant on its EVs, including the following:
- 2022 GMC Hummer pickup built at Factory ZERO in Detroit and Hamtramck.
- 2023 Cadillac Lyriq SUV built at Spring Hill Assembly in Spring Hill, Tennessee
- 2024 Chevrolet Silverado pickup to be built at Factory ZERO and Orion Assembly in Orion Township.
“We also look forward to collaborating with MP Materials from a public policy perspective to seek policies that are supportive of the establishment of an efficient U.S.-based rare earth and magnet supply chain,” Coomer said.
MP Materials said the Fort Worth plant is a “first-of-its kind U.S. facility.” It is part of a $700 million investment the company will make over the next two years to build a U.S. rare earth magnetics supply chain. It will have the capacity to produce approximately 1,000 tons of neodymium-iron-boron (NdFeB) magnets per year.
Research firm Adamas Intelligence forecasts that global demand for NdFeB magnets will triple by 2035 as demand rises for EV motors, “wind power generators, energy efficient consumer appliances and more,” MP Materials cited.
The new factory will source materials from Mountain Pass, California. The facility there recycles about 1.7 billion liters of water per year for environmental sustainability, MP Materials said. In February, MP Materials said, it won a $35 million grant from the Department of Defense to refine and process rare earth elements at Mountain Pass.
MP Materials’ new plant in Texas will be a 200,000-square-foot facility that will create around 150 high-skill jobs and 1,300 indirect jobs. It will produce magnets powering 500,000 EV motors per year, with potential to scale, MP Materials said.
In December, GM leaders said the automaker will not have an ownership stake in MP Materials but rather a traditional supplier agreement. GM did not release financial terms of the deal.
In December, GM also announced it has a nonbinding memorandum of understanding with German-based supplier VAC that GM expects to finalize this year. VAC makes advanced magnetic materials. It will start making those magnets for GM in 2024.
GM will not have an ownership stake in VAC. GM and VAC have said a new plant will built in the U.S. to manufacture permanent magnets for the electric motors.
Magnets are an essential part of EV motors and drive units, GM spokesman David Caldwell told the Detroit Free Press in December. Forming partnerships for raw material sourcing secures GM’s supply chain for EVs and makes the materials more North American-focused, he said.
Last year, GM also formed a joint venture with South Korea-based chemical maker POSCO Chemical. GM and POSCO announced in March they are building a factory in Quebec, Canada, to open by 2024. It will process key battery materials used in GM’s EVs.
GM and LG Energy Solution have a joint venture called Ultium Cells LLC which is building three new battery cells plants in the U.S. located in Lordstown, Ohio, Spring Hill, Tennessee, and Lansing. There will be a fourth, but no location has been announced yet.
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Contact Jamie L. LaReau at 313-222-2149 or jlareau@freepress.com. Follow her on Twitter @jlareauan. Read more on General Motors and sign up for our autos newsletter. Become a subscriber.