Biden Administration Provides $650 Million for Michigan Auto Factories Transitioning to Electric Vehicle Production

Biden Administration Allocates $650 Million to Michigan Auto Plants for EV Production

President Joe Biden’s administration has granted over $1 billion to facilitate the reinvention or reopening of 11 automotive factories, directing more than $650 million specifically toward two facilities based in Michigan that are shifting production to electric vehicles (EVs). This funding was part of the Inflation Reduction Act, passed in 2022 by Congress.

Support to GM’s Lansing Grand River Plant and ZF North America

The retooling strategy encompasses General Motors’ Lansing Grand River Assembly, which will undergo renovations to manufacture new electric vehicle models. The plant may receive up to $500 million, conditional on performance parameters such as retooling, hiring, retention, and production. This plan will maintain more than 650 UAW jobs at the factory while adding 50 fresh positions.

ZF North America Inc. will also receive funding of approximately $158 million to revamp a section of its Marysville plant in St. Clair County. This project will transition production from parts for internal combustion engine vehicles to components for EVs, retaining 536 jobs, including 387 UAW roles.

Biden’s Campaign and the Lansing Visit

The announcement comes just before President Biden’s campaign journey to Detroit, undertaken to mitigate growing apprehensions about his re-election prospects. Biden is working hard to project and enforce stability and coherence, both in his speeches and his administrative decisions.

A Wider Scope of the Funding

Beyond the two Michigan factories, this grant extends to a variety of projects to bolster the supply chains and assembly mechanisms for electric automobiles, trucks, and buses nationwide.

This includes $335 million to resuscitate Stellantis’ discontinued Fiat Chrysler assembly factory in Belvidere, Illinois, moving the facility towards EV production, subsequently restoring about 1,450 union positions. An additional $250 million targets the conversion of Stellantis’ transmission factory in Kokomo, Indiana, to the manufacture of electric drive modules for battery-powered EVs, ensuring the retention of 585 UAW jobs.

Other plants in states including Ohio, Pennsylvania, Georgia, Maryland, and Virginia are also beneficiaries of these grants, bound to maintain the momentum of the currently thriving EV market.

Reception of the Initiative

The US Energy Secretary and former Michigan governor, Jennifer Granholm, expressed appreciation for this move. “There is nothing harder to a manufacturing community than to lose jobs to foreign competition and a changing industry,” she said, adding that this investment will ensure the competitive edge for the American automotive industry in the race towards electric mobility.

On the other hand, skeptics, primarily Trump and Republican party members, have criticized the government’s aggressive support for increasing EV production, focusing on new emission standards that seemingly enforce automobile manufacturers to sell EVs, potentially impacting customers.