The U.S. government has committed up to $7.54 billion in funding for Astellanti’s joint venture with Samsung SDI to assist in the construction of two electric car battery factories in Kokomo, Indiana.
According to a statement released by the Energy Department on Monday, the StarPlus Energy LLC project is anticipated to generate at least 2,800 employment at the factories and hundreds more in a nearby park for companies that sell parts.
Although the financing has not yet been approved, the government stated that the promise demonstrates its intention to fund the project. In order to receive the loan, StarPlus needs to come up with a strategy to work with labor and community leaders to create well-paying jobs. Before the government will finance the loan, it must also satisfy technical, legal, environmental, and financial requirements.
It is uncertain if the loan will be completed prior to Donald Trump’s inauguration on January 20. During his campaign, Trump promised to cut off funding for these projects, referring to them as the “green new scam.” On Monday, a message was left asking the Trump transition team for response.
It would be reckless for “any government to turn its back on private sector partners, states, and communities that are benefiting from lower energy costs and new economic opportunities” from the loans, the Energy Department said in response to a question about whether the loan would be funded prior to the inauguration.
According to the agency, the plants would produce modules and battery cells for electric vehicles that would be marketed in North America. The factories will generate enough batteries annually at full capacity to power around 670,000 automobiles.
“This will greatly expand EV battery manufacturing capacity in North America and reduce America’s reliance on adversarial foreign nations like China,” claimed the statement.
In the event that the project is approved, Stellantis would get $6.85 billion in principle plus $688 million in interest.
Rivian Automotive, an electric vehicle manufacturer, received a $6.6 billion loan late last month to construct a factory in Georgia, but the project has stagnated since the business has had difficulty turning a profit.
The loan news was made a day after Stellantis announced that Carlos Tavares, the CEO of the automaker that owns Jeep, Ram, Citroën, and Peugeot, is leaving his position after almost four years in the top job. In the midst of an ongoing battle with declining sales, the fourth-largest carmaker in the world declared on Sunday that its board has accepted Tavares’ resignation, effective immediately.
While a search for a new CEO is being conducted, the company said a new interim executive committee will be formed, with Chairman John Elkann at its head.
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