Federal government supports creation of $1 billion electric vehicle manufacturer subsidy
The Biden-Harris administration is continuing to pour billions of dollars into the transition to electric vehicle (EV) production, with the latest initiative being a collaboration with asset management firm Monroe Capital to create a $1 billion fund for small- and medium-sized automotive manufacturers and suppliers. John Bozzella, president and CEO of the Alliance for Automotive Innovation, emphasised the importance of this fund, stating that the automotive supply chain consists of hundreds of companies, many of which are small and medium-sized businesses. These companies, he said, have found the transition to EV production more expensive than anticipated, and this fund is intended to alleviate some of these costs. The fund will focus on makers of powertrain, body, drivetrain, chassis, interiors, electrical components, and software-as-a-service providers. It will support investments in new technologies, smart factories, autonomous driving systems, and other connected technologies related to electric vehicle production. Monroe Capital plans to apply for a Small Business Administration Small Business Investment Company (SBIC) license to participate in the fund. Following the licensing process, they will begin fundraising. The SBIC license will allow Monroe Capital to offer companies low-cost, government guaranteed-leverage. The creation of this fund is part of the administration's ongoing efforts to bring more funding to automakers and suppliers transitioning to electrification. Last week, the administration announced $3 billion in funding for battery manufacturers, and the Department of Energy has unveiled $15.5 billion in funding and loans to help automakers transition to EV production. The fund, named 'White House inspired' and supported by MEMA, The Vehicle Suppliers Association, and Alliance for Automotive Innovation, was launched by Monroe Capital. Specific companies applying for the SBIC license from the Small Business Administration to participate in the fund are not disclosed in the provided search results. The administration's efforts aim to ease the capital expense of the transition for automakers and suppliers. The fund will help these companies invest in the necessary technologies to transition from internal combustion production to electric vehicles, thereby aiding the country's end-to-end auto supply chain in its transition to EV production.
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