In a significant move that signals changing priorities, Rio Tinto's new chief executive Simon Trott has put the brakes on what would have been one of Europe's largest lithium projects in Serbia. This decision comes as the world's second-largest mining company prepares to outline its strategic direction next week at a crucial investor meeting in London.
New Leadership, New Direction
Simon Trott, who took charge of Rio Tinto in August 2025, has promised fundamental changes to the company's operations. The newly appointed CEO has already demonstrated his willingness to make tough decisions by mothballing the Serbian lithium project that was aggressively pursued under former CEO Jakob Stausholm.
In a memo to employees last month, Trott made his intentions clear: "The changes we are making are not incremental—they are fundamental." This statement, seen by The Wall Street Journal, underscores the significant shift happening within the mining giant.
The leadership changes extend beyond project decisions. Paul Graves, the head of Rio Tinto's lithium business and former CEO of Arcadium Lithium, is also departing the company as Trott assembles his core leadership team.
Contrasting Lithium Strategy
Rio Tinto's substantial bet on lithium last year stood in stark contrast to other major mining companies. While competitors struggled to see lithium generating profits comparable to copper or iron ore, Rio Tinto moved aggressively into the battery metal sector.
The company completed a $6.7 billion takeover of Arcadium Lithium in March 2025, a deal originally agreed upon under previous leadership. This acquisition represented one of the largest commitments to lithium by any major mining company globally.
However, investors and analysts don't expect Trott to completely abandon lithium. Instead, they anticipate a more refined approach where lithium projects will develop more slowly than originally planned, with the company focusing on its most promising opportunities.
Competition for Capital
Lithium faces stiff competition for investment within Rio Tinto's diverse portfolio. The company maintains massive iron ore operations in Australia and is developing a new pit in Africa with Chinese partners. Additionally, a major copper project in the United States is likely to take precedence over lithium investments if approved, according to RBC Capital Markets analyst Ben Davis.
Stephen Butel, portfolio manager at Platypus Asset Management, noted the strategic importance of lithium despite the current reassessment: "As western demand for lithium increases, Rio should be best placed to fulfill this demand as supplier of choice, versus the rest of the industry which are small scale players or balance-sheet constrained."
Broader Strategic Review
Trott's changes appear part of a comprehensive strategic overhaul. Goldman Sachs analyst Paul Young highlighted that over the past five years, Rio Tinto has made approximately $15 billion in acquisitions while selling assets valued at less than 1 billion Australian dollars ($653.3 million) since 2018.
This acquisition-heavy approach has left the company with an extensive portfolio including up to 20 projects in development across more than 30 countries covering over 10 different commodities.
Trott has already initiated strategic reviews of several operations, including Rio Tinto's borates business in California and an iron and titanium operation in northern Quebec. At a recent Goldman Sachs conference, Trott summarized his philosophy: "I think if you try and do everything, you get nothing done."
Analysts suggest that potential asset sales could include the Canadian iron-ore business, Pacific Aluminium operations, recently acquired stake in North American recycler Matalco, and several lithium plants including the shelved Jadar project in Serbia.
Addressing Shareholder Concerns
One significant challenge facing Trott is the nearly 15% stake in Rio Tinto's London-listed stock owned by Aluminum Corp. of China (Chinalco). This holding has prevented share buybacks due to Australian government restrictions on the state-owned Chinese company's interest.
While Goldman's Young suggests an asset-for-equity swap could provide a solution, Ninety One portfolio manager George Cheveley believes the company may not immediately address this longstanding shareholder concern. "I think they see it as a problem," Cheveley noted, "But I don't think Trott will necessarily plot a path to fixing it. I think they'll just solve it at some point."
The investor gathering in London on Thursday will provide the first detailed look at Trott's comprehensive vision for Rio Tinto, potentially setting the course for the mining giant's future in the rapidly evolving global commodities market.
