As countries around the world take measures to curb carbon emissions, the electric vehicles (EVs) sector has become an excellent avenue for long-term growth. However, due to high manufacturing costs, low demand, and several other factors, investors shy away from buying EV stocks.
In this regard, there is one stock that can be a smart way to invest in EVs. It is Lithium Americas (TSX:LAC). Keep reading to find out why.
Lithium Americas separates to form two independent lithium companies
As per reports on October 4th, Lithium Americas has completed its reorganization to become two separate publicly traded entities. One is Lithium Americas Corp. (TSX:LAC), while the other is Lithium Americas (Argentina) Corp. (TSX:LAAC).
This separation will enable the companies to focus on their respective regions, namely the United States and Argentina, thus capitalizing on the developing lithium industry.
USD 1 billion loan from the US Department of Energy
According to data on September 29th, Lithium Americas is in talks with the USA Department of Energy (DOE) to get a USD 1 billion loan for its Nevada project. This mine has the potential to be North America’s largest lithium source.
It can act as a reliable long-term supplier for the EV batteries industry and will aid US President Joe Biden’s efforts to reduce dependency on Chinese imports. As per company sources, this loan can fund up to 75% of the project and help the company strengthen its position in the North American market.
Strong progress in Lithium Americas’ long-term projects
Reports on August 10th state that Lithium Americas’ Caucharí-Olaroz project in Argentina has completed its first lithium production. It is ready to ramp up to its 40,000 tonnes/annum Stage 1 capacity of generating battery-grade lithium carbonate by mid-2024.
Additionally, in the Pastos Grandes Basin, the company continues advancing its USD 30 million development plan. It has also completed a geophysics program in order to efficiently map the basin and develop its brine production system.
The company has also acquired Arena Minerals, along with the latter’s 65% interest in the Sal de la Puna project. These moves will enable Lithium Americas to significantly increase its presence in Argentina’s lithium industry.
Bottom line
Keeping in mind the business plans of Lithium Americas, this company has strong long-term profit-generating potential. Furthermore, given the major role played by this metal in EV battery production, investing in this stock is surely an excellent way to gain exposure to the electric vehicle industry.
