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US allocates $15.5 bn to boost electric vehicle transition
Industry News- Sep 01,23
The United States Department of Energy is allocating $15.5 billion to facilitate the shift towards electric vehicles (EVs).
In accordance with President Joe Biden's "Investing in America" agenda, the majority of these funds will be directed toward assisting automakers and their suppliers in reconfiguring their facilities for the production of electric, hybrid, and hydrogen fuel cell vehicles. Of this sum, $12 billion will be designated for direct support of automotive manufacturing conversions, encompassing light-, medium-, and heavy-duty EVs, with $2 billion in grants and $10 billion in loans.
The remaining $3.5 billion will be earmarked for the expansion of domestic battery manufacturing for EVs, fortifying the nation's grid, and bolstering the production of battery materials and components that have traditionally been imported from foreign sources. This constitutes the DOE's second round of funding for battery materials and manufacturing.
In recent years, numerous automakers and battery manufacturers have revealed plans to construct battery manufacturing facilities within the United States. This trend gained momentum as the COVID-19 pandemic disrupted supply chains, causing challenges in procuring vital battery materials, most of which were previously sourced from China. The passage of the Inflation Reduction Act in August 2022 further accelerated domestic manufacturing efforts, as it introduced a range of incentives for manufacturers. However, the Treasury still needs to provide guidance on several aspects of the bill's initiatives.
These federal investments in domestic EV and battery manufacturing align with the Biden administration's commitment to generating well-paying manufacturing jobs for Americans, particularly in traditionally conservative states such as Georgia, North Carolina, and Tennessee.
Manufacturers will have the opportunity to apply for grants through the DOE's Office of Manufacturing and Energy Supply Chains or seek preferential debt financing through the DOE's Loan Program Office. Preference will be given to companies operating in communities with a history of automotive manufacturing and to projects committed to offering competitive wages to production workers while maintaining collective bargaining agreements.
Electric Vehicles
DOE funding
Automotive Manufacturing
Battery Manufacturing
EV transition
Inflation Reduction Act
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