Stellantis invests in direct lithium extraction project

Stellantis (NYSE:) said Thursday that the carmaker will be investing more than $100 million in California-based direct lithium extraction (DLE) company, Controlled Thermal Resources.

Different DLE technologies come with their own unique approaches, but all share the common goal of extracting lithium from saline brine deposits through mechanical filtration. This innovative process eliminates the necessity for open pit mines or extensive evaporation ponds.

This deal is happening at a time when people are getting worried that there might not be enough lithium and other materials to meet the high demand following the push for green energy and the U.S. Inflation Reduction Act.

Stellantis plans for half of its vehicles to be electric by 2030. They’ve also decided to significantly increase their lithium purchase from Controlled Thermal. The previous order of 65,000 metric tons per year will now almost triple, lasting at least a decade from 2027.

“This is a significant investment and goes a long way toward developing this key project,” said Controlled Thermal CEO Rod Colwell.

Stellantis CEO Carlos Tavares called the Controlled Thermal partnership “an important step in our care for our customers and our planet as we work to provide clean, safe and affordable mobility.”

Controlled Thermal had separately agreed to supply lithium to General Motors (NYSE:) by 2024. However, that goal has been pushed back to 2025.

GM said it has a “close working relationship” with Controlled Thermal and added that the company has enough raw material supply to reach its target of producing 1 million EVs by 2025.

Shares of STLA are up 0.56% in premarket trading Thursday.