US Unveils $3 Billion Critical Minerals Plan, Bolstering EV Supply Chains
The US government has committed $3 billion to domestic critical mineral projects to reduce reliance on China, creating a paradox where an administration opposed to electric vehicle subsidies is inadvertently financing the battery supply chains that power them.
The Trump administration announced a $3 billion federal investment in domestic critical minerals projects last week. The funding, unveiled at a State Department industry roundtable, aims to scale production and decouple the US from Chinese battery supply chains.
Although the administration views the initiative primarily as a boost for defense and aerospace, the policy carries major implications for commercial markets. Electric vehicles account for over half of global demand for minerals like lithium, cobalt and nickel, meaning miners must cater to the auto sector to achieve profitable scale.
This creates a striking contradiction for an administration that has actively rolled back clean energy support. In July 2025, the GOP-sponsored One Big Beautiful Bill Act terminated $7,500 new and $4,000 used EV tax credits while cutting manufacturing subsidies.
The largest single commitment in the new package is a $1.4 billion conditional loan from the Pentagon’s Office of Strategic Capital to Sila Nanotechnologies. The funds will support a fivefold expansion of the company’s silicon anode battery materials plant in Moses Lake, Washington.
The facility currently produces roughly 2 gigawatt-hours of material annually. The expansion aims to increase capacity to supply more than 100,000 electric vehicles alongside critical technology sectors.
Canada-based Lithium Americas also secured the first $435 million drawdown from a $2.23 billion Department of Energy loan. The capital will fund the Thacker Pass project in Nevada, which is targeted for completion in late 2027.
The Nevada facility is designed to produce 40,000 metric tons of battery-grade lithium carbonate annually in its first phase. That output is sufficient to supply approximately 800,000 EVs per year, exceeding the roughly 550,000 vehicles Tesla sold in the US in 2025.
The broader package includes a $25 million Export-Import Bank investment for Westwater Resources to develop an Alabama graphite deposit. Additionally, Niron Magnetics received a conditional commitment for up to $150 million to build a Minnesota plant producing rare-earth-free permanent magnets.
The latest funding follows the February launch of Project Vault, a $12 billion public-private stockpile initiative. The program functions as commercial insurance, shielding automakers and tech firms from sudden shortages and price volatility across more than 50 critical minerals.
The reserve is backed by a $10 billion Export-Import Bank loan and nearly $2 billion in private capital from investors including Hartree Partners and Mercuria Energy Group. Participating manufacturers, such as General Motors and Boeing, pay subscription fees to buy reserves at predetermined prices during market shocks.
