Washington August 31 2023: The Biden administration is making $12 billion available in grants and loans for automakers and suppliers to retrofit plants to produce electric and other advanced vehicles, Energy Secretary Jennifer Granholm told reporters on Thursday.
"While we transition to EVs, we want to ensure that workers can transition in place, that there is no worker, no community left behind," Granholm, a former governor of car manufacturing state Michigan, told reporters in a call.
Speeding grants and other subsidies to fund conversion of existing auto plants to build electric vehicles could help the White House blunt criticism from automakers and the United Auto Workers (UAW) union over proposed environmental rules aimed to help usher in the EV era.
The UAW has warned that a rapid change could put thousands of jobs at risk in states such as Michigan, Ohio, Illinois and Indiana.
Last week UAW members voted overwhelmingly in favor of authorizing a strike at the Detroit Three automakers if an agreement over wages and pension plans is not reached before the current four-year contract expires on Sept. 14.
"I don't know that this will have an impact on the collective bargaining," Granholm said, adding that the administration has spoken with automakers, auto workers, and communities.
UAW President Shawn Fain has campaigned to save a Jeep factory in Belvidere, Illinois, that Stellantis (STLAM.MI) has put on track to shutter. The automaker has left open the possibility that the factory could get a new product with government aid.
When asked if the funding could keep the Stellantis plant open, Granholm said plants that had been built up around communities are "prime for taking advantage of these funding opportunities."
There will be no specific labor requirements for companies to get the funding, but projects that have better labor conditions will have a better chance of getting the funding an Energy Department official said on the call.
For the advanced vehicles, $2 billion of the funding will come from the Inflation Reduction Act Democrats passed last year, and $10 billion will come from the Energy Department's Loans Program Office, Granholm said.