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US President Joe Biden steps out of an electric Chevrolet Silverado pickup truck watched by GM CEO Mary Barra in Detroit, Michigan, the US, September 14 2022. Picture: REUTERS
US President Joe Biden steps out of an electric Chevrolet Silverado pickup truck watched by GM CEO Mary Barra in Detroit, Michigan, the US, September 14 2022. Picture: REUTERS

The Biden administration plans to award General Motors (GM) and Chrysler-parent Stellantis nearly $1.1bn in grants to convert existing plants to build electric vehicles and components, it said on Thursday.

The department of energy announced $1.7bn in planned grants to help fund the conversion of 11 “at risk” plants in eight states to enable the production of 1-million electric vehicles (EVs) annually, help retain 15,000 existing jobs and create 3,000 new positions.

Energy secretary Jennifer Granholm told reporters the awards were a “hallmark of the Biden administration’s industrial strategy” and would “modernise historical auto manufacturing facilities”.

She said it had become clear more than a decade ago that vehicle makers, to embrace the future, “needed a federal partner especially to compete with other countries who were subsidising their auto industries and that’s what this huge investment is all about”.

The grant will benefit multi EV brand Stellantis to accelerate platform sharing ranges from its Fiat, Dodge, Peugeot and other subsidiaries. Picture: SUPPLIED
The grant will benefit multi EV brand Stellantis to accelerate platform sharing ranges from its Fiat, Dodge, Peugeot and other subsidiaries. Picture: SUPPLIED

The awards are for plants in Michigan, Ohio, Pennsylvania, Georgia, Illinois, Indiana, Maryland, and Virginia — several of which are crucial in the November presidential election.

Biden has prodded US vehicle makers to assemble a rising number of EVs, introduced new tax incentives and funded EV charging stations. Regulators have also issued stricter emissions rules that will boost EV sales.

Republican presidential hopeful Donald Trump has harshly criticised Biden’s EV policies and vowed to reverse them if he takes office. The White House is courting union workers in key battleground states and seeking to reassure motor industry workers that EVs will not cost jobs.

GM will receive $500m to convert its Lansing Grand River assembly plant in Michigan to EVs at an unspecified future date. GM said it would make its own unspecified investment to produce EVs in Lansing in the future, but said the plant would continue to produce the Cadillac CT4 and CT5.

In October, Stellantis agreed to build a new $3.2bn battery plant and invest $1.5bn in a new mid-sized truck factory in Belvidere, Illinois, under a new, Biden-backed union contract.

The energy department plans to award Stellantis $334.8m to convert the shuttered Belvidere assembly plant to build EVs and $250m to convert its Indiana transmission plant in Kokomo to produce EV components. Stellantis said the expected awards were “an important step in continuing to expand our electrified vehicle offerings”.

Hyundai Mobis, which operates a Stellantis supplier in Ohio, will receive $32m to produce plug-in hybrid components and battery packs.

Motorcycle brand Harley-Davidson will get $89m to expand its York, Pennsylvania plant to make zero-emission components and electric power train systems. Picture: REUTERS
Motorcycle brand Harley-Davidson will get $89m to expand its York, Pennsylvania plant to make zero-emission components and electric power train systems. Picture: REUTERS

Other awards include $89m for Harley-Davidson to expand its York, Pennsylvania, plant for EV motorcycle manufacturing; $80m for Blue Bird to convert a former Georgia plant to build electric school buses; and $75m to engine company Cummins to convert part of an existing Indiana plant to make zero-emission components and electric power train systems.

The department also plans $208m for the Volvo Group to upgrade plants in Maryland, Virginia and Pennsylvania to increase EV production capacity and $157m for ZF North America to convert part of its Marysville, Michigan, plant for EV component production.

The department must still complete negotiations with companies on milestones and other requirements and complete environmental reviews before the awards are finalised. 

Reuters

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