Grants for Electric Vehicles: U.S. Offers $12 Billion to Automakers and Placate Unions
Key takeaways
- The Biden administration is offering $12 billion in loans and grants for automakers to convert their plants for EV production
- The announcement has been praised by the United Auto Workers union, which has criticized the rapid change putting jobs at risk
- The UAW is set to reach a new labor deal by mid-September or go on strike
The Biden administration has made another big step towards making the U.S. a green tech haven by offering automakers and suppliers $12 billion in grants to retrofit their existing plants ready for the EV revolution. The move could help smooth things over with the workers union — here’s what you need to know.
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What’s the latest in EVs?
$12 billion in loans and grants? That’s what the Biden administration is offering to automakers and suppliers to convert their existing plants to produce EVs and other advanced vehicles. $3.5 billion in funding will also be offered to domestic battery manufacturers for making EV batteries.
In a nod to the automotive industry’s union, an Energy Department official also confirmed that while there aren’t specific labor requirements to qualify for the loan or grant, projects with better labor conditions will be more likely to get the funding.
Of the announcement, President Biden said, “Building a clean energy economy can and should provide a win-win opportunity for auto companies and unionized workers who have anchored the American economy for decades.”
Does the move placate the UAW?
The United Auto Workers (UAW) are at the centre of the announcement and have threatened to go on strike if a new four-year deal isn’t reached. Last week, the union members overwhelmingly voted to strike if an agreement on pensions and wages wasn’t concluded by the 14 September deadline.
The UAW has previously criticized the Biden administration for its rapid pace in bringing the EV revolution to the U.S., warning the rapid change could put thousands of jobs at risk.
However, UAW president Shawn Fain praised the latest grants announcement, commenting the grants deal “makes clear to employers that the EV transition must include strong union partnerships with the high pay and safety standards that generations of UAW members have fought for and won.”
The bottom line
It sounds like a good move from the Biden administration to win over the workers and corporations in one fell swoop. At a time when simmering tensions with the UAW threaten to disrupt the automotive industry, Biden is clearly thinking long-term about how workers and companies can co-exist in the new world of EVs.
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