Source: Gasgoo
The U.S. Department of Energy is racing against the clock to finalize a $335 million grant to help Stellantis retrofit its Belvidere, Illinois, automotive plant.
The Stellantis Belvidere Auto Plant project calls for retrofitting a Chrysler plant that began operations in 1965 to produce electric pickup trucks and building a battery plant nearby. In 2019, the plant also had 5,000 workers. Before the plant was shelved in February 2023, 1,350 workers were working on the Jeep Cherokee.
The projects are expected to cost about $5 billion and create 4,000 jobs. The project is part of a new contract with the United Auto Workers union, but has been on hold for more than a year. The UAW had already threatened Stellantis with a strike over a delay in the Belvidere plant investment plan, which prompted Stellantis to file a lawsuit to stop the strike.
Jeep Cherokee; Image Source: Jeep
In July, the U.S. Department of Energy announced plans to grant Stellantis $334.8 million, but the deal has not been finalized. The US Department of Energy is in talks with Stellantis and hopes to reach an agreement by the end of the year, people familiar with the matter said.
Once the DOE finally reaches an agreement with Stellantis, the grant will be considered “legally effective,” making it difficult for the Trump administration to recoup the money.
The DOE grant is critical for Stellantis, which is currently scrambling to find a new chief executive officer and has been struggling with declining sales.
Stellantis declined to comment on the report.
Before the next US President, Donald Trump, takes office, current US President Joe Biden is trying to fund projects such as the US Inflation Reduction Act and the Infrastructure Bill.
However, demand for electric vehicles in the US has now slowed, causing automakers to delay plans for new electric models. Trump also said he would eliminate a $7,500 tax credit for consumers who buy electric vehicles, which could further slow the flow of Energy Department funds.
