Biden awards US$1.7b to boost EV manufacturing and assembly in eight states

The Biden administration is awarding nearly US$2 billion in grants to General Motors, Fiat Chrysler, and other carmakers to help restart or expand electric vehicle manufacturing and assembly sites in eight states, including the presidential battlegrounds of Michigan, Pennsylvania, and Georgia.

The Energy Department will issue grants totalling US$1.7 billion to create or retain thousands of union jobs and support auto-based communities that have long driven the US economy, the White House said Thursday. Besides the three battleground states, grants also will go to EV facilities in Ohio, Illinois, Indiana, Maryland, and Virginia.

The grants cover a broad range of the automotive supply chain, including parts for electric motorcycles and school buses, hybrid powertrains, heavy-duty commercial truck batteries and electric SUVs, the White House said.

“Building a clean-energy economy can and should be a win-win for union autoworkers and automakers,’’ President Joe Biden said in a statement. “This investment will create thousands of good-paying, union-manufacturing jobs and retain even more – from Lansing, Michigan, to Fort Valley, Georgia – by helping auto companies retool, reboot and rehire in the same factories and communities.’’

GM said Thursday that its US$500 million federal grant will help the company convert an assembly plant in Lansing, Michigan, to produce EVs. GM has already announced over US$12 billion in investments in its North American EV manufacturing and supply chain since 2020. That investment and the federal grant “underscore our commitment to US leadership in manufacturing and innovation″, said Camilo Ballesty, GM vice-president of North America Manufacturing and Labor Relations.

The grants, paid for by the landmark 2022 climate law, will help deliver on his commitment to ensure that the future of the auto industry is made in America by American union workers, Biden said.

“Workers that were left behind by my predecessor are now making a comeback with the support of my policies, including the conversion grants my administration is announcing today,’’ the Democratic president said.

The grants announced Thursday come after a federal competition that included four times as many applicants as grant recipients, the Energy Department said. Officials declined to identify companies that unsuccessfully applied for grants but said that all projects that were awarded funding currently employ Americans working in union jobs in the United States.

“There is nothing harder to a manufacturing community than to lose jobs to foreign competition and a changing industry,’’ said Energy Secretary Jennifer Granholm, a former Michigan governor. Even as competitors like China invest heavily in electric vehicles, the federal grants will help “ensure that our automotive industry stays competitive – and does it in the communities and with the workforce that have supported the auto industry for generations”, Granholm said.

The new grants complement US$177 billion in private-sector investment in EV and battery manufacturing since Biden took office, Granholm and other officials said.

Awards are subject to negotiations to ensure that commitments to workers and communities are met, officials said. The US Energy Department also will complete environmental reviews before money is awarded later this year.

If awards are completed as planned, the selected projects would create more than 2,900 jobs and help ensure that about 15,000 union workers are retained across all 11 facilities, the White House said. The grants come after successful union organising drives from Chattanooga, Tennessee, to Fort Valley, Georgia, the White House said.

“The president will not take his foot off the pedal when it comes to supporting the US auto industry,’’ said White House national economic adviser Lael Brainard.

Transportation accounts for the single largest source of US greenhouse gas pollution, and Biden has made electric vehicles a key part of his climate agenda.

“Not only are we delivering new sources of clean transit – that iconic yellow school bus going green – but we’re also delivering to the American people options to save ... thousands of dollars of fuel and maintenance costs over the lifetime of a vehicle’’ by going electric, White House climate adviser Ali Zaidi said.

Companies slated for awards include Blue Bird Body Company, which will receive nearly US$80 million to convert a Georgia site previously used to make diesel-powered motor homes to produce electric school buses. Fiat Chrysler will receive nearly US$335 million to convert an idled assembly plant in Illinois to assemble electric vehicles and US$250 million in a separate grant to convert an Indiana transmission plant to make electric drive modules for EVs.

Harley-Davidson will receive US$89 million to expand a facility in York, Pennsylvania, to make electric motorcycles, and Volvo Group will receive US$208 million to upgrade three manufacturing facilities that supply and build Mack and Volvo-branded heavy-duty trucks. The plants are located in Macungie, Pennsylvania; Dublin, Virginia; and Hagerstown, Maryland.

AP