US automaker GM interested in Brazilian mining sector

US-based automaker General Motors (GM) is looking to find out more about the potential of the Brazilian mining industry, particularly with regard to minerals crucial for building electric vehicles (EVs), amid growing appetite in this segment.

“What is already happening in Argentina, Chile and Bolivia is starting to gain traction in Brazil as well, with global vehicle manufacturers entering the mining sector strongly, specifically in segments such as lithium, nickel, copper and cobalt, to guarantee supply for the production of their electric vehicles,” Jomar Napoleão, a partner specialized in the EV area at Brazilian consultancy Carcon Automotiv, told BNamericas.

South American representatives of GM held a meeting on Tuesday with officials of Brazilian mining association Ibram to discuss the country’s mining landscape.

“The company contacted Ibram to learn about data and forecasts for Brazilian mining production. There needs to be a guaranteed and growing supply of critical minerals for the decarbonization of vehicles, in Brazil and across the planet,” Ibram head Raul Jungmann said in a statement.

“Acting in this regard is one of Abram’s concerns, so we are proposing that [the government] prepare a national policy aimed at expanding the production of strategic minerals, such as lithium, copper, niobium, cobalt and rare earths, among others,” Jungmann added.

The GM representatives attending the meeting included Adriano de Barros, the company’s director of government relations; Daniel Capelossi Caramori, senior manager of government relations; and Luiz Roberto Vieira Gonçalves, manager of institutional affairs.

General Motors’ interest in the Brazilian mining comes as automakers look to shore up supplies to underpin the expected rapid growth in EV production.

“The effects of the pandemic and then the Russian invasion of Ukraine led to a collapse in the global supply chain and this resulted in a general breakdown of confidence across the world. Unlike what happened before this scenario, automakers are now tending to be a shareholders of mining projects, or even in companies, as this provides a firmer guarantee of supply,” said Napoleão.

Earlier this week, ACG, a London-listed special purpose acquisition company (SPAC), announced a US$1bn agreement to acquire two nickel and copper mine operations in Brazil owned by private equity funds advised by Appian Capital Advisory.

The deal was backed by global mining company Glencore, automotive conglomerate Stellantis and mining investment fund La Mancha Resource Capital, as well as Power Co, a subsidiary of German automaker Volkswagen.