GM’s investment in EnergyX shows a growing trend among auto manufacturers for potentially higher-risk lithium sources as concerns over supplies continue to grow.  

General Motors (GM) has announced a US$50M investment in Texas-based Direct Lithium Extraction (DLE) technology developer EnergyX. This announcement comes shortly after GM announced a significant investment of US$650M in US-based Lithium Americas in February this year. EnergyX is aiming to develop its Lithium-ion Transport and Separation (“LiTAS”) modular DLE service, which would be capable of being adapted to a variety of brine resources of differing qualities worldwide.  

Project Blue has in the past commented on the growing trend of downstream auto-manufacturers looking to take stakes in upstream battery raw material supply routes as concerns over future supplies for electric vehicle manufacturing continue to grow. However, this investment by GM differs from previous investments. Notably, GM’s investment in EnergyX is not aimed at securing at raw material supply, as with the company’s investment in Lithium Americas, but at new technologies to access lithium supplies and the possibility of opening up new supply routes within North America, and potentially other countries which fulfil the requirements of the Inflation Reduction Act (IRA). This shift in market positioning may represent a new strategy on the part of downstream OEM’s, which have traditionally been focused on developing sources of battery raw materials and channelling these supplies into the companies’ offtakes. However, EnergyX, with it’s focus on DLE has several challenges yet to overcome before being considered commercial.  

While EnergyX has proven able to develop a DLE pilot plant at the Salar de Uyuni in Bolivia, and produce lithium carbonate, scaling up to a commercial scale presents challenges. At present, there are limited examples of DLE technology successfully being employed at commercial scale. Frequently, the industry has seen examples of capital cost blowouts as DLE flowsheets fail to deliver on feasibility-level targets, or even engineering failures leading to projects unable to move beyond the pilot stage. This latest investment by GM shows that concerns over battery materials supplies are leading downstream OEM’s to consider production flowsheets further outside of the norm, and which potentially carry a greater capital risk.