Biden Administration to Award $1.1 Billion in Grants for Electric Vehicle Plant Conversions

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The Biden administration has announced plans to allocate nearly $1.1 billion in grants to major automotive manufacturers General Motors (GM) and Stellantis, aiming to support the transformation of their existing manufacturing facilities for electric vehicle (EV) production. This initiative, disclosed on Thursday, is part of a broader $1.7 billion effort by the Department of Energy (DOE) to facilitate the conversion of 11 plants across eight states. The objective is to enable the annual production of 1 million electric vehicles, sustain 15,000 existing jobs, and generate an additional 3,000 new positions.

Energy Secretary Jennifer Granholm emphasized that these awards represent a pivotal component of the Biden administration’s industrial strategy. She described the grants as crucial for “modernizing historic auto manufacturing facilities” and highlighted the necessity of federal support for automakers to compete globally. Granholm noted that over a decade ago, it became evident that to embrace future technologies, automakers needed federal partnerships, particularly to contend with other nations subsidizing their automotive sectors. This substantial investment, she stressed, underscores the administration’s commitment to this cause.

The awarded funds will support plants located in Michigan, Ohio, Pennsylvania, Georgia, Illinois, Indiana, Maryland, and Virginia. Several of these states are key battlegrounds in the upcoming November presidential election, reflecting the administration’s strategic interest in these areas.

President Joe Biden has been actively promoting the shift towards electric vehicles, encouraging U.S. automakers to increase their EV production. His administration has introduced new tax incentives and funded the establishment of EV charging stations, alongside implementing stricter emissions regulations to drive EV sales.

In contrast, former President Donald Trump has been vocal in his criticism of Biden’s EV policies, pledging to reverse them should he return to office. The current administration is working to reassure union workers in critical states that the transition to electric vehicles will not come at the expense of jobs.

As part of the grant distribution, General Motors is set to receive $500 million to convert its Lansing Grand River Assembly Plant in Michigan for electric vehicle production at an unspecified future date. GM has also indicated that it will make additional investments in the Lansing facility to produce EVs, though it will continue to manufacture the Cadillac CT4 and CT5 at the plant for the time being.

In October, Stellantis agreed to invest $3.2 billion in a new battery plant and $1.5 billion in a new mid-size truck factory in Belvidere, Illinois, under a new union contract—an initiative that has been highlighted by President Biden. The DOE plans to award Stellantis $334.8 million to repurpose the now-closed Belvidere Assembly plant for EV production and $250 million to convert its Indiana Transmission Plant in Kokomo for EV component manufacturing. Stellantis has welcomed these expected grants as a significant step towards expanding its electrified vehicle offerings.

Additionally, Hyundai Mobis, which operates as a Stellantis supplier in Ohio, is set to receive $32 million to produce plug-in hybrid components and battery packs.

Other notable awards include:

– $89 million for Harley-Davidson to expand its York, Pennsylvania plant for EV motorcycle manufacturing.

– $80 million for Blue Bird to convert a former Georgia plant into a facility for building electric school buses.

– $75 million for Cummins to adapt part of its existing Indiana plant for the production of zero-emission components and electric powertrain systems.

The DOE also plans to allocate **$208 million** to the Volvo Group to upgrade its facilities in Maryland, Virginia, and Pennsylvania to enhance EV production capacity. Additionally, **$157 million** is earmarked for ZF North America to convert part of its Marysville, Michigan plant for EV component production.

Before these awards are finalized, the DOE must complete negotiations with the companies on specific milestones and requirements, and finalize environmental reviews. This comprehensive review process is crucial to ensuring that the funds are used effectively and in alignment with the administration’s goals for advancing electric vehicle technology and infrastructure.