Green Labor Journal - Working for a Substainable Future

Advanced Batteries Will Be “Made In America”

Obama awards $2.4 billion for next-generation electric car batteries.

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“Retooling the U.S. auto industry to accelerate domestic production of advanced-technology and alternative-fuel vehicles and their key components will also create jobs in the United States.”
          ─ AFL-CIO Executive Council Resolution on “Sustainable Good Green Jobs”

On August 5, 2009, President Obama announced $2.4 billion in grants to accelerate the manufacturing and deployment of the next generation of U.S. batteries and electric vehicles.

A U.S. Department of Energy (DOE) press release reported that the Stimulus Plan will fund 48 new advanced battery and electric vehicle projects in 20 states.

In Elkhart, Indiana, President Obama said, “If we want to reduce our dependence on oil, put Americans back to work and reassert our manufacturing sector as one of the greatest in the world, we must produce the advanced, efficient vehicles of the future.”

These projects, competitively selected by the DOE under the American Recovery and Reinvestment Act of 2009, “will accelerate the development of U.S. manufacturing capacity for batteries and electric drive components as well as the deployment of electric drive vehicles, helping establish American leadership in creating the next generation of advanced vehicles.”

“For our nation and our economy to recover, we must have a vision of what can be built here in the future – and then we need to invest in that vision,” said Vice President Joe Biden.
   
Battery Gold Rush

The Obama Administration’s initial request for applications set off what The Wall Street Journal called a “battery gold rush,” as companies and states hurried to stake their claim as the future U.S. hub for the rapidly growing advanced car batteries market. A 2008 Alliance Bernstein study projected that the current $9 billion-a-year auto-battery market could soar to more than $150 billion by 2030.
                   
Presently, the world-wide market for lithium-ion batteries, the current technology of choice for future electric cars, is dominated by four large Japanese and Korean companies, including Sony and Panasonic.   
                                                                     
General Motor’s Chevy Volt, the all-electric car planned for 2010 production, dominated the grants. G.M. received $106 million for battery pack production in Brownstone, MI, for the Volt, which is estimated to go the first 40 miles daily on electricity and then the rest on gasoline.

Compact Power received $151 million for production of cells for the Volt, to be manufactured in several Michigan towns.  In addition, G.M. received $105 million for factory construction for the next generation of rear drive electric vehicles in White Marsh, MD, and Wixom, MI. 

Ford Motor Company was awarded $30 million to develop plug-in hybrid vehicles for 15 electric utilities and another $63 million to produce electric drive train components.  Chrysler received $70 million to develop and deploy plug-in hybrid vehicles.

Greg Martin, a G.M. spokesman, suggested that the company fared so well in the DOE competition because it was significantly ahead of U.S. competitors in plug-in hybrid research and development ─ a major goal of the Obama-Biden New Energy for America Plan.

Other $100-million-plus award winners for advanced battery and materials manufacturing facilities include: Johnson Controls; A123 Systems, Compact Power, and EnerDel.

Importance to Labor

These DOE awards mark the largest single investment in advanced battery technology and electric-drive vehicles ever made.  Industry officials anticipate that this $2.4 billion in federal grants, coupled with another $2.4 billion in cost sharing funds from the award winners, will create tens of thousands of manufacturing jobs in the U.S. battery and auto industries.
   
Energy Secretary Steven Chu said that these awards “will help achieve the President’s goal of putting one million plug-in hybrid vehicles on the road by 2015.  And, most importantly, they will launch an advanced battery industry in America and make our auto industry cleaner and more competitive."

According to the DOE, the new awards cover the following areas:
    •   $1.5 billion in grants to U.S. based manufacturers to produce batteries and their components and to expand battery recycling capacity;
    •   $500 million in grants to U.S. based manufacturers to produce electric drive components for vehicles, including electric motors, power electronics, and other drive train components; and
    •   $400 million in grants to purchase thousands of plug-in hybrid and all-electric vehicles for test demonstrations in several dozen locations; to deploy them and evaluate their performance; to install electric charging infrastructure; and to provide education and workforce training to support the transition to an advanced electric transportation system.

The importance of these grants to American labor was underscored by United Steel Workers President, Leo Gerard, during the national debate over providing federal bailouts for General Motors and Chrysler. Gerard said, “As much as for the UAW, this is a life and death struggle for the USW, American manufacturing, and for millions of Americans in good-paying jobs.”   

“The Steelworkers represent hundreds of thousands of workers whose jobs depend on the auto industry -- from steelworkers who make the steel, to the rubber workers who make the tires, to the glass workers who make the windshields, to the paper workers who make the glossy pamphlets. Altogether, more than 7 million paychecks depend on the U.S. auto industry.”

Jerry Brown, Ph.D., is Senior Editor of the Green Labor Journal.