MICHIGAN—President Joe Biden’s administration is making nearly $16 billion in federal funding available to help the nation’s automakers and parts suppliers retrofit their manufacturing facilities to start producing more electric vehicles, federal officials announced this week.
At a press conference Thursday, US Energy Secretary Jennifer Granholm announced that about $10 billion in federal cash will be loaned out to automakers—specifically to upgrade facilities that pay above-average wages and are located in communities that have long relied on automotive manufacturing to support their economies, including several cities across Michigan.
About $2 billion in grant funding will go out to US automakers and various parts suppliers to support the transition to electric, hybrid-electric, and hydrogen-powered vehicles. Another $3.5 billion will be earmarked specifically to help automakers ramp up electric vehicle battery production.
And when the funding is awarded, it’ll be union-run shops that get first dibs, Granholm said.
“We don’t always need to reinvent the wheel. Instead, you can realign it,” Granholm said this week. “This combination of grants and loans shows that the Department of Energy is flexible, and also has the full spectrum of capital available to help companies navigate this transition.”
She added: “We’re trying to make sure that communities that have long been manufacturing are not disadvantaged in this transition. We want to make sure that no community is left behind.”
For the United Auto Workers, the federal funding—and the government’s focus on unionized labor—represents a major commitment to ensuring that workers aren’t left behind in the electric vehicle transition.
UAW President Shawn Fain said the funding announcement “echoes the UAW’s call for strong labor standards tied to all taxpayer funding that goes to auto and manufacturing companies.”
“This new policy makes clear to employers that the EV transition must include strong union partnerships with the high pay and safety standards that generations of UAW members have fought for and won,” Fain said in a statement following Thursday’s press conference.
The UAW represents nearly a half-million employees in the US, Canada, and Puerto Rico. About 150,000 of them have threatened to go on strike this month as tensions rise amid contract talks between major automakers and the union. Contracts with General Motors, Ford, and Stellantis all expire at 11:59 p.m. on Sept. 14, and the negotiations are reportedly moving very slowly.
In Michigan, that means thousands of employees of Detroit’s biggest car companies could walk off the job and hit the streets in protest if a deal isn’t reached in the next two weeks.
Fain said that the Detroit Three have closed or spun off 65 plants in the last 20 years, and have still not yet promised job security amid the ongoing negotiations. He said he expects the new grants and loans from the federal government will help ensure more jobs stay protected.
“The UAW looks forward to continuing to work with the Biden Administration to ensure a just transition for the auto workers in this country,” Fain said in a statement on Thursday.
Biden also released a statement:
“As I’ve said before, under Bidenomics building a clean energy economy can and should provide a win‑win opportunity for auto companies and unionized workers who have anchored the American economy for decades,” he said. “This funding will help existing workers keep their jobs and have the first shot to fill new good jobs as the car industry transforms for future generations.”
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