WASHINGTON, Aug. 31 (Reuters) – Energy Secretary Jennifer Granholm said on Thursday that the Biden administration is providing $12 billion in grants and loans to automakers and suppliers to upgrade their plants to produce electric cars and other advanced vehicles.
“As we transition to electric vehicles, we want to make sure that workers can commute where they are, and that no worker or community gets left behind,” Granholm, the former governor of automaker Michigan, told reporters on a conference call.
Accelerating grants and other subsidies to fund converting existing auto plants to build electric vehicles could help the White House ease sharp criticism from automakers and the United Auto Workers (UAW) over proposed environmental rules meant to help usher in the electric car era.
And the UAW warned that the rapid change could put thousands of jobs at risk in states like Michigan, Ohio, Illinois and Indiana.
Last week, UAW members voted overwhelmingly in favor of allowing a strike at the three Detroit automakers if no agreement on wages and retirement plans is reached before the current four-year contract expires on Sept. 14.
“I don’t know that this will have an impact on collective bargaining,” Granholm said, adding that the administration has spoken with automakers, auto workers and communities.
“Building a clean energy economy can, and should, provide a win-win opportunity for the auto companies and unionized workers who have helped anchor the American economy for decades,” President Joe Biden said in a statement.
UAW President Sean Fine has campaigned to save the Jeep plant in Belvidere, Illinois, which Stellantis Corporation (STLAM.MI) has put on track for closure. And the automaker left open the possibility of the plant acquiring a new product with government assistance.
When asked about opportunities for grants to keep this factory open, Granholm said that factories that are built around the communities “are key to taking advantage of these funding opportunities.”
An official with the Ministry of Energy said during the call that there will be no specific work requirements for companies to obtain financing, but projects with better working conditions will have a greater chance of obtaining financing.
The administration will also provide $3.5 billion in financing to domestic battery manufacturers, Granholm said.
For advanced vehicles, $2 billion in grants will come from the Inflation Reduction Act that Democrats passed last year, and $10 billion in loans will come from the Energy Department’s Office of Loan Program.
Reporting by Timothy Gardner in Washington; Editing by Bill Berkrot and Matthew Lewis
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