The company logo for lithium producer Livent Corp is displayed on a screen at the New York Stock Exchange (NYSE) during the company's IPO in New York, U.S., October 11, 2018. REUTERS/Brendan McDermidRegister now for FREE unlimited access to Reuters.comAug 2 (Reuters) - General Motors Co (GM.N) is prepaying Livent Corp (LTHM.N) $198 million for a guaranteed six-year supply of lithium, a deal that reflects the auto industry's rising worry about a tightening market for the electric vehicle battery metal.Prepaying cash for a guaranteed metal supply is unusual in the mining industry. The deal shows GM's eagerness to ensure it has sufficient raw materials to meet its goal of producing 1 million EVs annually in North America by 2025.Both companies announced the broad brushstrokes of the deal last week, but Livent announced financial terms on Tuesday as it posted a better-than-expected profit and raised its forecast for the year.Register now for FREE unlimited access to Reuters.com"GM is certainly thinking for the long term here," Paul Graves, Livent's chief executive, told investors on a Tuesday conference call. "By making the advanced payment, they are clearly giving us the commitment that we were looking for."Graves has long prodded automakers to work closer with lithium producers. In an interview with Reuters last fall, Graves warned that unless the auto industry signed long-term deals, "there may be periods where there is just insufficient lithium."Livent produces lithium in Argentina and has processing facilities in the United States.Livent, which also supplies BMW(BMWG.DE),expects to receive the GM prepayment later this year. The company is set to start supplying GM in 2025 at a contractual price per tonne, though neither company disclosed volume.Philadelphia-based Livent reported second-quarter net income of $60 million, or 31 cents per share, compared with $6.5 million, or 4 cents per share, a year ago.Excluding one-time items, Livent earned 37 cents per share. By that measure, analysts expected earnings of 29 cents per share, according to IBES data from Refinitiv.Livent said expansion of its Argentina site is on schedule. The company's stock rose slightly in after-hours trading.Register now for FREE unlimited access to Reuters.comReporting by Ernest Scheyder; editing by Jonathan Oatis, Bill Berkrot and David GregorioOur Standards: The Thomson Reuters Trust Principles.Ernest ScheyderThomson ReutersCovers the future of energy and transportation including electric vehicle and battery technology, with a focus on lithium, copper, cobalt, rare earths and other minerals, politics, policy, etc. Previously covered the oil and natural gas, including a stint living in North Dakota’s Bakken shale oil patch.
GM prepaying Livent $198 million for guaranteed lithium supply.