The US is providing $12 billion in subsidies for electric vehicles.

The US government announced on August 31 that it will subsidize and provide loans to automakers to accelerate the transition to electric vehicles.

U.S. Energy Secretary Jennifer Granholm announced on August 31 that the Biden administration will provide $12 billion in grants and loans to automakers and their suppliers. The goal is to equip factories to produce electric vehicles and other advanced vehicles.

The $2 billion in subsidies will come from the Inflation Reduction Act passed last year. The $10 billion in loans will come from the Office of Lending at the U.S. Department of Energy. The U.S. government will also provide $3.5 billion in support to domestic battery manufacturers, Granholm said.

"In the transition to electric vehicles, we want to ensure that workers can commute locally. No one, no community will be left behind," Granholm told reporters.

A Tesla Model S at the showroom. Photo: Reuters — A Tesla Model S at the showroom. Photo: *Reuters*

Earlier this year, the Biden administration unveiled an ambitious policy proposal that electric vehicles would account for two-thirds of new cars sold in the U.S. between now and 2032.

Accelerating support for converting existing auto plants to electric vehicle production could also help the White House appease criticism from automakers and the United Auto Workers (UAW) union. Previously, U.S. officials proposed numerous environmental regulations to usher in the era of electric vehicles.

The UAW had previously warned that rapid change could jeopardize thousands of jobs in states like Michigan, Ohio, Illinois, and Indiana. Following the U.S. government announcement, UAW President Shawn Fain stated that the policy "has helped automakers understand that the transition to electric vehicles must be accompanied by increased wages and the safety standards that the UAW is requiring."

US President Joe Biden also affirmed that "building a clean energy economy benefits both sides – automakers and workers – the very groups that have supported the American economy for decades."

Fain had previously pledged to protect a Jeep manufacturing plant in Illinois that Stellantis wanted to close. However, the automaker left open the possibility of reopening the plant if it could produce new products with government support.

When asked about the possibility of the $12 billion stimulus package helping factories reopen, Granholm said that factories "will benefit from the opportunities that open up thanks to this money."

A U.S. Department of Energy official said there are currently no specific labor regulations in place to qualify companies for funding. However, projects with good labor conditions will have a higher chance of receiving funding.

Ha Thu (according to Reuters)

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