Lansing — Jennifer Granholm, U.S. energy secretary and former Michigan governor, said Thursday that President Joe Biden “is in the race and should stay in the race” for a second term, attributing federal investments into Michigan’s auto manufacturing to his leadership.
Granholm visited General Motors Co.’s Lansing Grand River Assembly Plant, which produces the Cadillac CT4 and CT5 and ended production of the Chevrolet Camaro in December. The plant is one of 11 at-risk or shuttered U.S. automotive manufacturing sites receiving $1.7 billion in federal grants distributed by the Energy Department’s Domestic Automotive Supply Chain Conversion Grants program from funding allocated by 2022’s Inflation Reduction Act.
Granholm’s visit comes after Biden, the 81-year-old presumptive Democratic nominee in this year’s presidential race, gave a shaky debate performance two weeks ago, raising questions from fellow Democrats over whether he should continue the pursuit. Michigan is a key electoral battleground and the cradle of the U.S. auto industry, which has been a pillar in Biden’s economic policies.
“President Biden is in the race and should stay in the race,” Granholm said following a formal presentation at the Lansing plant. “All of this churn about his capabilities. It’s completely off-mark. And he is on his game. He asks the hardest questions at cabinet meetings and conversations and bilateral meetings. He’s older, yes, but that also means he’s wiser. And he’s got so much experience and information. When you’re briefing the president, you better go in prepared, because he will ask questions that you hadn’t even thought about.”
Exhibit A, she said, for why Biden should stay in the race is the grants announced Thursday that are expected to create 2,900 jobs and retain 15,000 current ones in eight states. Smaller grants will be released at some point in the future. The awards are part of the administration’s policies seeking to encourage domestic manufacturing and the move to reduce greenhouse gas tailpipe emissions, though consumer hesitation to adopt electric vehicles because of affordability challenges and range anxiety is making that a bumpy road.
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Granholm in her formal remarks harkened to her days as governor of Michigan when the auto industry was flailing, and General Motors Corp. and Chrysler Corp. declared bankruptcies. She was calling the White House for help, and the automakers received bailouts from the Obama administration when Biden was vice president. She criticized laissez faire and trickle-down economics and said state incentive programs aren’t enough in an era of globalization.
“How can a state compete with the minds of China?” she said. “How can a state compete with the wages paid in Mexico? It was like bringing a knife to a gun fight for governors to try to keep these jobs. … I’m here to tell you today that they are different. What’s changed is that we have Joe Biden as our friend, Joe Biden, who decided that our country is going to do something about this, that we are not going to be passive any longer.”
Karoline Leavitt, national press secretary for former President Donald Trump’s campaign, said the need for the grants shows that Biden’s “EV mandate is crippling our economy.” His administration has instituted the strictest emissions and fuel economy standards to date, though automakers ultimately can make the decision on the powertrain mix of gas-powered, hybrid and electric vehicles that can get them to the targets.
“For years, Joe Biden has crippled our auto industry with a job-killing EV mandate while simultaneously allowing China to surveil our country and sending American jobs overseas,” Leavitt said. “Americans know that President Trump was tough on China while Joe Biden is weak, and they’ll welcome a new era of America First leadership when they send President Trump back to the White House.”
Although EV sales volumes are up, they’ve increased more slowly than many in the industry expected. Automakers over the past year have announced delays or cuts to EV programs and investments. Granholm highlighted other elements of the Biden administration’s efforts to promote EVs. She noted that the number of public chargers has more than doubled since the president took office, though critics have pointed out that private investment rather than federal support is driving that growth so far.
“I know that (automakers) have to adjust their plans based upon demand, and I know there is an effort out there on the part of some to talk down electric vehicles,” the former two-term governor said. “I expect that once we get by this election that will abate a bit because a lot of these incentives are going to states which are red states.”
Although the funding does support a future for the beneficiaries now, it doesn’t guarantee the long-term viability of the plants, said Tu Le, who serves as managing director of Sino Auto Insights, an innovation and management consulting firm with offices in Detroit and China.
“Only viable products will do that,” he said in a text message to The Detroit News, “so it still points to the challenge ahead for Stellantis and GM, especially when you consider that foreign brands now collectively sell more in the U.S. than the U.S. Three.”
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Le also expressed concerns that the federal government has gotten into the business of picking winners, or who it wants to succeed, in the industry.
“It’s just that Hyundai, Mercedes, BMW, Volvo and Tesla also all employ Americans,: he said. “They just don’t happen to be UAW employees. Is that right? Not so sure.”
The Energy Department does not disclose the full list of applicants for grant programs like this one, so it’s unclear how many other automakers applied. Volvo, a brand of China-based Geely Automobile Holdings Ltd., was a selectee and will receive up to $208 million for projects in Pennsylvania, Maryland and Virginia.
“I understand that a lot of Michiganders aren’t interested in driving an electric vehicle,” U.S. Rep. Elissa Slotkin, D-Holly, said in an interview with The News. “I live on my farm on a dirt road, nowhere near anything like charging infrastructure. I don’t drive an electric car. I probably can’t drive an electric car for the foreseeable future. But man, if someone’s going to build the next generation of electric vehicles, I want it to be the United States and not China.”
“All you have to do is look at Europe and Mexico and see that China is looking to be *the* manufacturer of this next generation of cars,” Slotkin, who is also running for U.S. Senate, said in an earlier statement. “That’s why it’s essential to our economic and national security that electric vehicles, the batteries and components they run on, and other critical products are made in America. The funding announced today will also protect existing jobs and generate new ones, while driving economic growth in the area, so it’s a clear win for Lansing.”
U.S. Rep. Debbie Dingell, D-Ann Arbor, shared a similar sentiment. “To keep America a global leader in EVs and manufacturing, we must ensure electric vehicles, their batteries, all their components, and their infrastructure are built here at home,” she said.
Dingell, a longtime voice on automotive issues in Washington, also praised the local impacts of the grants. “The (program) was designed to ensure auto communities and those who have built their lives on the auto industry are not left behind,” she added.
In contrast, Republican U.S. Senate candidate Sandy Pensler, a Grosse Pointe Park businessman, said consumer demand should guide the industry, not the government.
“While it is always nice to see Michigan get money this is more adhoc policy trying to buy votes rather than a market driven approach to allow the auto industry to meet the demands of consumers,” he said in a statement. “Government throwing out money willy nilly to specific industries it picks is bad policy. Here they are trying to mitigate damage from their misdirected policy of forcing EVs down consumers throats which has and will massively hurt Michigan and auto workers.”
GM will receive up to $500 million to convert Lansing Grand River to produce electric vehicles. In its application, GM said it would invest $900 million with the project expected to create 50 jobs and retain more than 650. The automakers says it will announce an official investment amount at a later time. Its contract with the UAW includes a $1.25 billion commitment to the plant. Which model the plant will produce and when the conversion will happen hasn’t been shared.
“GM’s investment and this Department of Energy grant underscore our commitment to U.S. leadership in manufacturing and innovation, making sure we’re competitive at home and abroad,” Camilo Ballesty, GM vice president of North America manufacturing and labor relations, said in a statement. “Our Lansing Grand River team produces incredible vehicles for our customers, and we’re proud to bring our commitment to performance and quality into our EV future.”
Added UAW Region 1D Director Steve Dawes: “I would be remiss not to thank the Biden administration for having the faith to pass these things and put their faith in the American worker and invest in our people, who are proven and time-tested. Let’s give them a little boost.”
Workers like Mark Monroe, 53, of Grand Rapids, an 18-year GM employee and a team leader at the plant, said the support brings peace of mind: “It’s a good morale booster. We’re excited about any product that gives us a future, regardless of the powertrain.”
UAW Local 652 GM Unit Chair Rollin Green said it’s not surprising the plant received the largest award available from the grant program.
“I’ve never missed an opportunity to tell GM Detroit,” he said, “if you want to build better, if you want to build it right, you’ve got to bring it to Lansing.”
“I am once again the happiest mayor in America,” Lansing Mayor Andy Schor said during the presentation, referencing a social media post by The Detroit News’ Chad Livengood that dubbed him that when GM in 2022 announced it was building an EV battery plant in the city with partner LG Energy Solution Ltd. “We put the world on wheels. Now … we’re going to put the world on electric EV wheels. We know this is the future.”
In addition to GM, Stellanits NV will receive $335 million for its plans to bring EV production at its Belvidere Assembly Plant, which ended production of gas-powered Jeep Cherokee crossovers last year. Its contract with the United Auto Workers calls for a $1.5 billion investment in the Illinois plant for a midsize truck. The project would restore about 1,450 unionized jobs, according to a project plan provided to the Energy Department.
Stellantis is slated to receive another $250 million to convert the Indiana Transmission Plant to produce electric drive modules, which is expected to retain and train 585 UAW-represented employees. Its UAW contract specifies an expected $900 million in investments into that site.
Ford Motor Co. didn’t receive any grants. One other site in Michigan that is a recipient is German auto supplier ZF Group’s facility near the St. Clair County border with Canada. The $157.7 million will support production of components for passenger and heavy-duty EVs. That’s expected to retain 546 workers, most of whom will be represented by the UAW.
“When it comes to those things that take a lot of sophistication and focus and skill to make things at scale, you can’t be better than Michiganders,” Quentin Messer Jr., CEO of the Michigan Economic Development Corp., told The News. “And this is further proof that the men and women of Michigan have earned the right to win these competitive brands.”
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