The Biden administration's plan to promote electric vehicles and reduce dependence on China received a boost on Monday with the announcement that the U.S. Energy Department would lend $2.5 billion to GeneralMotors.
Ultium is a joint venture that will use the money to make batteries in Ohio, Tennessee and Michigan. The loan is contingent on the companies meeting certain requirements and is the first in more than a decade.
Electric vehicle technology has been promoted by the U.S. government. Many universities and entrepreneurs have received money from the Energy Department's Advanced Research Projects Agency to develop batteries that can be charged faster and contain more energy per pound. Sila Nanotechnologies in Alameda, Calif., and Solid Power in Louisville, Colo., are two companies that are close to being able to make advanced batteries for cars.
More than 5,000 permanent jobs are expected to be created by the Ultium factories. According to G.M., the Ohio factory will start making battery packs this year.
The cost of electric vehicles can be lowered by domestic battery manufacturing. It's a good idea to build batteries close to car factories.
Ohio and Michigan will be reassured that they will not be left out of the electric vehicle boom, thanks to the investments in those states. Corporate investments in new electric car and battery factories go to states in the South.
The secretary of energy said that advanced batteries should be made in Michigan.
Congress last year passed an infrastructure law that the Biden administration hopes will lay the ground for millions of electric cars and establish a domestic supply chain for battery manufacturing.
The administration wants to spend more than $7 billion to establish supplies of materials used to make batteries and to build electric vehicle charging stations along major highways. The world's largest battery maker is based in the city of Ningde.
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