The Biden administration plans to provide $1.7 billion to convert closed or at-risk auto manufacturing and assembly facilities to build electric and hybrid vehicles.
The funding comes as growth in new electric vehicle sales slows, and the administration seeks to keep U.S. factories competitive in the face of a growing Chinese industry.
Energy Secretary Jennifer Granholm announced that the funding comes as part of the Biden administration’s manufacturing strategy, which aims to bring manufacturing jobs back to the United States after years of offshoring.
The selected destinations for the funds, which come from the historic Inflation Reduction Act, include eight states, including Michigan and Pennsylvania.
According to the administration, these projects are expected to create about 2,900 new jobs and avoid the loss of 15,000 jobs that were threatened. The list of companies benefiting from the funding includes major companies such as General Motors and Volvo, in addition to suppliers such as American Auto Parts.
President Joe Biden has expressed optimism about the investment, saying it will create thousands of good-paying union jobs and preserve more jobs in factories and communities from Lansing, Michigan, to Fort Valley, Georgia.
Biden added that building a clean energy economy must be a win-win for both auto workers unions and automakers.
According to experts, the move comes at a time when electric vehicle sales are slowing in growth, although overall sales continue to rise, and automakers are facing challenges in bridging the gap between early adopters and mass-market consumers.
Earlier this year, Biden announced a quadruple of tariffs on Chinese electric vehicles, in a move aimed at boosting domestic industry and competing with the world’s second-largest economy in the electric vehicle market.
