The Biden administration announced on Thursday, July 11, that it intends to provide $1.7 billion grants for 11 auto factories, totaling nearly $1.1 billion to General Motors (GM.N) and Chrysler-parent Stellantis.
Biden Administration's Nearly $2 Billion Grants for Automakers
Several plants in Michigan, Ohio, Pennsylvania, Georgia, Illinois, Indiana, Maryland, and Virginia are receiving awards, and their significance extends to the upcoming November presidential election.
According to Reuters, these grants will be used to convert their existing plants for the production of electric vehicles and components.
The Department of Energy (DOE) has recently unveiled a significant plan to provide $1.7 billion in grants. These funds will be allocated towards the conversion of 11 plants in eight states that are currently facing challenges.
The aim is to enable these plants to produce 1 million electric vehicles (EVs) on an annual basis. This initiative not only seeks to retain 15,000 existing jobs but also create 3,000 new positions.
Energy Secretary Jennifer Granholm highlighted the significance of the awards, emphasizing their role in the Biden administration's industrial strategy and their potential to upgrade existing auto manufacturing facilities.
The speaker emphasized the importance of a federal partnership for automakers to stay competitive in the global market. They highlighted the need to invest in the future and level the playing field with countries that were providing subsidies to their own auto industries.
The Biden administration has been actively encouraging American automakers to increase their production of electric vehicles.
In addition, they have implemented new tax incentives and provided funding for the development of electric vehicle charging stations. Regulators have recently implemented more stringent emissions regulations, which are expected to have a positive impact on the sales of electric vehicles.
Biden's Detroit Campaign Amidst Reelection Concerns
According to USA Today, the announcement came just before President Joe Biden's campaign trip to Detroit on Friday, as he aims to address mounting concerns about his reelection prospects.
Recent polls indicate that he is trailing former President Donald Trump in Michigan and other swing states. Additionally, his performance in a recent debate raised questions about his ability to answer coherently.
In addition to the generous grants awarded, a substantial amount of $335 million has been allocated to the reopening and transformation of Stellantis' previously idle Fiat Chrysler assembly plant in Belvidere, Illinois.
This investment will enable the facility to focus on the production of electric vehicles, ultimately leading to the restoration of approximately 1,450 union jobs.
An additional $250 million has been allocated to transform Stellantis' transmission plant in Kokomo, Indiana.
The aim is to produce electric drive modules, which integrate the motor, transmission, and other electronics into a single unit for battery-powered electric vehicles. This investment will help preserve 585 UAW jobs at the plant.
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