Lithium Americas Stock Surges Over 80% as Trump Administration Seeks 10% Stake Amid Loan Talks

A pure-play US lithium company, Lithium Americas (NYSE: LAC), witnessed its stock price surge over 80% during premarket Wednesday trading after reports emerged that the Trump administration is planning to buy an equity stake of up to 10% as it renegotiates terms of the company's $2.26 billion (£1.67 billion) loan from the US Energy Department for its Thacker Pass lithium project with General Motors (NYSE: GM).

The proposed stake follows the Trump Administration's intervention in taking stakes in companies like Intel (NASDAQ: INTC) and Material Corp. (NYSE: MP), as well as other tech and minerals companies it deems important to national security.

The Thacker Pass mine is expected to become one of the largest sources of lithium when it becomes operational in 2028. Construction commenced a year ago with over 600 contractors working at the site. The mine is being touted as a vital project in developing a domestic supply chain to boost US lithium production and lower dependence on China.

The US produces under 5,000 metric tonnes of lithium at a Nevada facility. Thacker Pass' phase 1 is expected to produce 40,000 metric tonnes annually, enough to power up to 800,000 electric vehicles. China already produces 40,000 metric tonnes of lithium annually.

Trump approved the $2.93 billion (£2.17 billion) Thacker Pass project at the end of his first term. However, the 24-year term loan from the Energy Department was closed in 2024 by officials of the Biden Administration.

Lithium Americas was preparing to make its first draw on the loan in early September of this year, but Trump officials intervened to renegotiate terms amid concerns about its ability to repay, citing low lithium prices due to overproduction in China.

General Motors invested $625 million (£463.55 million) in the Thacker Pass mine in 2024 in exchange for a 38% stake. It has the right to purchase all of the project's lithium from phase 1 and a portion from phase 2 for 20 years. Now, Trump officials are seeking a guarantee that General Motors will buy the metal.

In response to the equity request and to close the loan to secure funding, Lithium Americas earlier this week reportedly offered the government no-cost warrants equating to up to 10% of its common shares. Trump officials are also urging General Motors to give up its control over parts of the project and transfer them to Washington.
General Motors is relying on Thacker Pass to supply most of its lithium requirements for its electrification push. It described the loan as a 'necessary part of the financing to commercialise this important national resource' and noted that Trump 'strongly supported' the mine in his first term.

'We're confident in the project, which supports the administration's goals,' a GM reportedly told a media outlet.

Lithium Americas, which has a market value of $750 million (£556.26 million), is one of several companies developing US lithium projects. The other companies include Exxon Mobil (NYSE: XOM) and Standard Lithium (NYSE: SLI).

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