The US Is Loaning GM and LG $2.5 Billion For Three Battery Plants
Photo: Emily Elconin/Bloomberg (Getty Images)
President Joe Biden announced a $2.5 billion loan for GM and LG to build a new battery plant here in the U.S., Geely’s premium EV maker Zeekr wants to go public, and the results of the United Auto Workers’ leadership election might not be clear until January 2023. All this and more in The Morning Shift for Monday December 12, 2022.
1st Gear: GM and LG Awarded $2.5B for Battery Plants
In the continuing trend for massive amounts of cash being spent on EVs, $2.5 billion will soon be spent on a new battery plant here in the U.S. After Hyundai and BMW announced they would plow millions into stateside battery plants, the U.S. government has upped the stakes by announcing a massive loan for General Motors and LG.
The $2.5 billion loan will be handed out by the U.S. Department of Energy’s Loan Programs Office, reports CNN. The loan will help start three lithium battery manufacturing hubs in Ohio, Tennessee, and Michigan. According to CNN:
The DOE loan programs office will loan the money to Ultium Cells LLC, a joint venture of General Motors and South Korean battery manufacturer LG Energy Solutions making batteries to power electric vehicles. General Motors has pledged to go all-electric by 2035, phasing out conventional gas and diesel-powered engines.
In a statement, US Energy Secretary Jennifer Granholm said the DOE loan would “jumpstart the domestic battery cell production needed to reduce our reliance on other countries to meet increased demand.”
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The Department of Energy estimates that the three new battery plants will create up to 11,000 jobs here in America.
Automakers have been scrambling to move their EV manufacturing to the U.S. in recent months. It followed the passing of the Inflation Reduction Act, which secured up to $7,500 in tax credits for EV sales, but only for vehicles assembled here in America.
2nd Gear: Chinese EV Maker Zeekr Wants to Go Public
If there’s anything EV startups love, it’s going public. After Polestar and Fisker went public, among others, Vietnamese automaker VinFast looked to be following suit. And now, Chinese EV maker Zeekr appears to be taking the plunge too.
Reuters reports that the Geely-backed EV maker is considering an initial public offering to help it raise more than $1 billion. According to Reuters:
Zeekr, Chinese automaker Geely’s upmarket electric car brand, has confidentially filed for a U.S. initial public offering, aiming to raise more than $1 billion, three sources with direct knowledge of the matter told Reuters.
In what would be the first major Chinese flotation in the U.S. in more than a year and a half, Zeekr is seeking a valuation of more than $10 billion, two of the sources said. That compares with a valuation of about $9 billion in its maiden external fundraising last year.
Zeekr has reportedly lodged its filings with U.S regulators and is planning to go public in the second quarter of 2023.
Next year, Zeekr is also planning to launch its first EV in Europe. The Zeekr 001 SUV is expected to launch in Europe in 2023 with dual electric motors and enough battery capacity to cover 400 miles per charge.
3rd Gear: UAW Leadership Won’t Be Elected ‘til January
The United Auto Workers leadership election has taken another twist, as it’s been reported that we might not know the real winners until January. Members of the union were voting to replace the board and elect a new president, but some positions will now be filled by runoff elections.
According to Automotive News, six new members of the 14-strong board will be sworn in later today. However, the presidential vote could not be settled as none of the five candidates were able to secure a majority of the votes. Automotive News reports:
Three regional directors, two vice presidents and the secretary-treasurer won election to the International Executive Board as outsider candidates, most running as part of the Unite All Workers for Democracy reform caucus. Those six newcomers are scheduled to be sworn in Monday, Dec. 12.
“Ray Curry, the incumbent president, will go head-to-head in January against Shawn Fain, also from that caucus, after none of the five candidates earned a majority of votes. The race for a third vice president and one more regional director post will also be decided by runoffs.”
The results of the election mean that so far, reformers occupy six of the 14 positions of power. Members have pushed for reform at the union after it was gripped by a corruption scandal that involved a number of former officials.
Just 11 percent of UAW members voted in the elections.
4th Gear: Automakers Slam Switzerland’s EV Plans
Last week, rumors began to swirl that Switzerland was considering new measures to control the use and charging habits of EV drivers in the alpine nation. It was all meant to ease the load on its power supply should Russia’s invasion of Ukraine hit the grid over the coming months.
But, the measures, which included limits on charging EVs during blackouts, have been slammed by Switzerland’s auto lobby. According to Reuters, the Swiss car importers lobby (auto-schweiz) argued that the “mere suggestion” of such rules would encourage consumers to stick to fossil fuel-powered cars, instead of EVs. Reuters reports:
The government has proposed a series of increasingly tough measures to conserve energy as shortages of gas and power loom that could lead to rationing in a worst-case scenario.
One draft rule would curb the private use of electric vehicles unless urgently needed for work, shopping, or visiting the doctor or religious ceremonies.
The proposal is putting a chill on sales of electric cars, jeopardizing the sector’s prospects of reaching targets for reducing carbon emissions, auto-schweiz said.
As well as rules around when you can and cannot charge your EV, the Swiss government said, “it could curb non-essential use of power.” This would include illuminating shop windows or using mobile heaters. Reuters reports that this could cut power usage by 30 percent “as a last resort.”
5th Gear: A New Charger on the Block
If EV drivers in Switzerland are facing fewer charging opportunities, drivers of battery-powered cars in the U.S. could soon be facing opposite fortunes. That’s because Korean charger manufacturer Chaevi is looking to expand its network of fast chargers in America.
Bloomberg reports that the Korean manufacturer has already opened an office in the U.S. as it eyes expansion here and overseas. The company, which has so far installed 26,000 chargers in Korea, is also investigating sites for a manufacturing operation here in America. Bloomberg reports:
While that would mean going up against supercharging incumbents Tesla Inc., EVgo Inc. and Electrify America LLC, the recently passed Inflation Reduction Act is pushing Chaevi to consider investments in North America. The act, which seeks to reduce reliance on China and encourage automakers around the world to produce more cars in the US, may also provide for subsidies for EV charging makers.
Chaevi isn’t the only charger maker looking to expand into the U.S., according to the Bloomberg report. Battery manufacturer SK Group has backed charging provider Atom Power Inc, and Hyundai has struck a deal with Lotte Group, “under which the retail giant will provide real estate for Hyundai’s charging stations.”
Reverse: Latest Thing from Q Brach
Neutral: Do You Still Tune in?
I love listening to the radio. Back home, I was a big BBC 6Music listener whenever I wanted something on in the background. But then, as soon as I hit the road, I’m all about local stations. There’s something about the different accents you hear, different features that have, and an ever-changing mix of music that’s excellent for a long drive. The same goes over here, where you can flip-flop between gospel stations, rock radio, and talk shows as you soak up the miles.
On The Radio: The Darkness – “Christmas Time (Don’t Let the Bells End)”
The Darkness – Christmas Time (Don’t Let the Bells End) (Official Music Video) [HD]
