- The U.S. Department of Energy is reviving an old low-cost loan program, and the first recipient is Ultium Cells, the joint battery venture between General Motors Company GM and LG Energy Solution.
- Reuters was the first to report the news.
- The $2.5 billion loan is expected to close in the coming months and will be used for its upcoming lithium-ion battery cell manufacturing facilities in Ohio, Tennessee, and Michigan.
- GM and LG plan to invest more than $7 billion to build three battery plants.
- Related: Former Tesla Veteran Headed EV Battery Firm Redwood Materials Earmarks $3.5B For Nevada Plant
- Production at the Ohio factory is expected to begin in August. In Tennessee, production is scheduled for late 2023, and in Michigan for 2024.
- Ultium told Reuters the facilities would create 5,000 new high-tech jobs in the U.S. The loan agreement requires Ultium to offer employees local prevailing wage and fringe benefits.
- The funds come from the government’s Advanced Technology Vehicles Manufacturing (ATVM) loan program, tasked with issuing up to $17.7 billion in federal loans and hasn’t funded a new loan since 2010.
- The program previously provided low-cost government loans to Tesla Inc TSLA, Ford Motor Company F, and Nissan Motor Co Ltd NSANY.
- The DOE told Reuters the department has received more than $18 billion in loan requests from the auto program and expects another $5 billion to come through.
- Price Action: GM shares are down 1.38% at $34.04 premarket on the last check Tuesday.
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