Source：Gasgoo
The administration said it would spend more than $100 million to help small and medium-sized suppliers reequip or expand factories and improve their energy and security infrastructure.
The spending includes $50 million set aside by the U.S. Department of Energy (DOE) to help internal combustion engine suppliers start producing parts for electric vehicles. An additional $50 million is available to help companies improve energy and material efficiency, strengthen security and reduce greenhouse gas emissions. Each company can receive up to $300,000.
Before the White House announced the aid plan on May 6, U.S. auto parts suppliers, especially smaller ones, had been suffering for years from rising material and labor costs, fewer new car assemblies before the pandemic, and a host of supply chain problems that often hampered the production of cars and parts.
Image source: MEMA
MEMA, which represents more than 1,000 companies in the automotive supply chain, praised the aid plan of White House in a statement, saying the funding will help U.S. suppliers remain competitive as they transition to electric vehicles. In recent months, the group has been advocating for more federal support for small suppliers, when disruptions caused by the strike hurt suppliers’ finances.
Vice President Kamala Harris is expected to formally announce the funding at an event in Detroit on May 6. Michigan Governor Gretchen Whitmer, Secretary of Energy Jennifer Granholm and Acting Secretary of Labor Julie Su will also be in attendance.
MEMA CEO Bill Long said, “This significant investment and comprehensive set of actions announced by Vice President Harris will undoubtedly have a meaningful impact on the automotive industry. This is a clear step in the right direction for our enterprise members, empowering them to continue to thrive in the evolving automotive ecosystem.”
The administration said it would also use existing programs to help suppliers access millions of dollars in private capital to help them diversify their businesses.
The Department of Energy will work with the Small Business Administration to provide companies with technical expertise to help suppliers reduce risk and costs. In addition, the SBA will set up a pilot program to provide lines of credit and business counseling to small businesses, including suppliers and parts distributors.
In Detroit, Harris also plans to highlight other White House initiatives aimed at boosting the electric vehicle supply chain, including a recent $24 million grant from the U.S. Department of Energy for advanced manufacturing workforce training and a Battery workforce initiative aimed at developing training guidelines for skilled workers in electric vehicle battery manufacturing.
