The government plans to provide $15.5 billion in loans and funding to hasten the EV transition, with a special focus on providing money for retooling factories, the U.S. Department of Energy just announced.
The EV grants and loans are a portion of the Investing in America initiative advanced by the Biden administration and also have the objective of preserving good-paying American auto industry jobs.
The $15.5 billion in EV funding is divided into three major sections. One is $2 billion in grants to convert existing, established auto manufacturing plants to production of EV components and EVs. The Department of Energy notes that “projects that commit to pay high wages for production workers and maintain collective bargaining agreements” will be given priority for receiving these funds.
Meanwhile, $10 billion in loans is earmarked for EV manufacturing projects “that retain high-quality jobs in communities that currently host manufacturing facilities.” The grants noted above are mostly intended for conversion of existing facilities. Meanwhile, the loans will also be made available for building new plants, provided that existing plants are kept open until the new facilities begin operation and that “high-quality” jobs are retained in the same community.
The final element of the announced EV funding is $3.5 billion for EV battery material and EV battery investment. The U.S. Department of Energy announcement says this money will include grants to develop the USA’s domestic EV battery industry. This will help to increase availability of the North America-sourced battery materials required for EV purchases to qualify for tax credits, and reduce American dependence on foreign battery and battery material sources such as China.
GM has already launched several partnerships to source battery materials and EV batteries from within the U.S. or Canada. It recently invested $60 million in Mitra Chem to develop affordable iron-based cathode active materials (CAM) that are compatible with GM Ultium battery technology.
The General also partnered with POSCO Future M to invest $1 billion in a new CAM and precursor plant able to produce cathode materials for 360,000 EVs per year. The automaker intends the introduction of 30 new electric vehicles globally by 2025, with EV models in one third of automotive segments by the same year. The segments in question are the best-selling and account for 70 percent of vehicle sales each year.
General Motors is aiming for annual EV sales of over 1 million units by 2025 in its two major markets, North America and China.