General Motor's Joint Venture To Receive $2.5B Government Loan For Upcoming Battery Plants In US

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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