Biden administration aims $2 bln in grants at US electric vehicle transition

Nu Ride

28/06/2023 20:21

By Timothy Gardner and Joseph White
       WASHINGTON/DETROIT, June 28 (Reuters) - 
    President Joe Biden's administration on Wednesday said it
intends to invest $2 billion from last year's Inflation
Reduction Act to accelerate domestic manufacturing of electric
vehicles and resuscitate plants that are struggling.
    Speeding grants and other subsidies to fund conversion of
existing auto plants to build electric vehicles could help the
White House blunt criticism from United Auto Workers (UAW) union
over new environmental rules aimed to help usher in the EV era. 
    The Domestic Manufacturing Conversion Grants for EVs program
will provide cost-shared grants for making efficient hybrid,
plug-in electric hybrid, fully electric, and fuel cell vehicles.
    The Department of Energy's Vehicle Technologies Office said
the program will prioritize projects that refurbish or retool
manufacturing plants that have recently stopped operations or
were expected to close soon. 
    The goal is to preserve existing jobs, including union jobs
and wages, and "work opportunities in communities that have been
powering our automotive economy for decades," it said.
    Ohio-based electric truck maker Lordstown Motors  RIDE.O 
filed for bankruptcy protection on Tuesday, the latest filing
for Chapter 11 protection in a crop of startups that went public
during the pandemic-era boom in Special Purpose Acquisition
Companies (SPAC), which were publicly listed companies aimed at
acquiring private companies.
    The Biden administration, as part of its goal of
decarbonizing the economy by 2050, is pushing the U.S. auto
industry to accelerate a transition to EVs. The Environmental
Protection Agency has proposed rules that could result in as
much as two-thirds of the new vehicle market shifting to EVs by
2032. 
    The UAW has warned such a rapid change could put thousands
of jobs at risk in states such as Michigan, Ohio, Illinois, and
Indiana. Shawn Fain, the UAW president, has campaigned to save a
Jeep factory in Belvidere, Illinois that Stellantis NV
 STLAM.MI  has put on track to shut down. The automaker has left
open the possibility that the factory could get a new product
with government aid.
    Individual awards may be between $25 million and $500
million and funding for the grants would be available through
September, 2031.
    The notice of intent the Energy Department issued on
Wednesday is preliminary. The notice may soon be followed by
funding announcement that is similar to the notice,
significantly different, or may not be issued at all, it said.

 (Reporting by Timothy Gardner in Washington and Joe White in
Detroit; Editing by David Gregorio)
 ((timothy.gardner@thomsonreuters.com; +1 202 380-8348 (Twitter
@timogard); Reuters Messaging:
timothy.gardner.thomsonreuters.com@reuters.net))