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The Inflation Reduction Act (IRA), text adopted to transform the face of the United States in ecology and its interests has just been used to hit hard, across the Atlantic, as for electric cars. Indeed, several billion dollars have just been released. This is to convert current car factories to electric, the US Department of Energy announced on August 31.
In detail, 15.5 billion dollars are concerned, via a program in the IRA, named Domestic conversion grant program (Programme of assistance to the domestic reconversion). This is to help assemble the electrified vehicles and manufacture the components. The Ministry of Energy communicated on this subject:
“The Domestic Manufacturing Conversion Grants program for electric vehicles (…) will provide cost-shared grants for the domestic production of hybrid electric, plug-in hybrid, plug-in electric drive and hydrogen fuel cell vehicles.”
NEW: $15.5 BILLION to support a strong and just transition to electric vehicles, retooling existing manufacturing plants, and rehiring existing workers.https://t.co/O4gxo4xiET
— U.S. Department of Energy (@ENERGY) August 31, 2023
A helping hand for struggling US automakers
This will no doubt satisfy the American manufacturers. Ford and General Motors in particular are struggling to make a profit with electric vehicles. To do this, groups can “ask for assistance in the form of financial subsidies”.
It remains to be seen what this will bring. The idea of this plan is certainly to preserve many jobs in the United States, related to the automobile. The staggering costs of going electric and the difficulty of making it profitable could lead to massive layoffs.
In the meantime, automakers are already converting their factories to electric at the rate they can. General Motors has made its plant in Detroit-Hamtramck (Michigan) a “zero plant”. Honda is also pushing in this direction with the Marysville (Ohio) site. We should also mention Georgetown (Kentucky), which is home to a Toyota factory from which electrified vehicles will soon emerge.
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To sum up
On August 31, the US Department of Energy announced a program to convert the country’s factories to the production of electric vehicles. 15.5 billion dollars will be put on the table, among the 400 billion of the Inflation reduction act.
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