Biden offers automakers $15 billion for EV transition amid rigidity with union employees

The Biden administration revealed Thursday it would make out there greater than $15 billion for automakers to retrofit present manufacturing crops for gas-powered automobiles to as a substitute make vehicles and vehicles that run on electrical.

The transfer comes amid heightened tensions between President Biden and the auto trade, together with automakers and the United Auto Workers. The firms concern {that a} too-rapid clean-energy transition might damage their backside line whereas the unions concern the lack of hundreds of blue-collar union jobs.

“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,” Mr. Biden mentioned in an announcement.

The Department of Energy will present $2 billion in grants and as much as $10 billion in loans to repurpose factories for EVs.

The $2 billion in grants, supplied below Democrats’ tax-and-climate spending legislation referred to as the Inflation Reduction Act, can be prioritized for services that retain collective bargaining agreements or those who have “an existing high-quality, high-wage hourly production workforce, such as applicants that currently pay top quartile wages in their industry.”

The $10 billion in loans will come from DOE’s Loans Program Office.

DOE is in search of to additionally wean the U.S. off international dependency for the minerals and different supplies utilized in EV manufacturing by providing a further $3.5 billion in funding from the 2021 Bipartisan Infrastructure Law to transform crops to fabricate batteries utilized in EVs and the nation’s energy grid.

“While we transition to EVs, we want to ensure that workers can transition in place, that there is no worker, no community left behind,” Energy Secretary Jennifer Granholm instructed reporters.

She conceded that she was unaware whether or not the brand new funding “will have an impact on the collective bargaining” within the wake of UAW members on the large three Detroit automakers voting final week to go on strike until a wages and pensions deal is reached earlier than their contract expires in two weeks.

Nearly all — 97% — of the UAW’s 150,000 members with General Motors, Ford and Stellantis, which owns Chrysler, voted to authorize the strike.

The UAW didn’t reply to a request for remark concerning the new EV funding.

Rep. Dan Kildee, a Michigan Democrat whose district borders Detroit, mentioned he was glad with the administration’s motion and mentioned it will defend union jobs.

“Today’s announcement shows that the Biden administration is committed to creating good-paying union jobs here, not China,” he mentioned. “For over a century, Michigan has led the way in automotive manufacturing because of its highly skilled union workers. With these new efforts, Michigan will continue to lead the way and put the world on wheels.”

To power a extra speedy EV transition, the Biden administration is proposing such stringent tailpipe emissions guidelines that automakers could be pressured to promote predominantly EVs somewhat than gas-powered vehicles by 2030.