The Department of Energy under President Donald Trump is reshaping $1.7 billion of grants that were originally intended to help major car makers convert factories to electric‑vehicle (EV) production. The money will now be channelled to boost the output of hybrid vehicles and other advanced automotive technologies, including regenerative braking systems.
Grant allocations
Internal DOE documents list the following allocations: $584.8 million to Stellantis, $500 million to General Motors, $285 million to Mercedes‑Benz and $208 million to Volvo. The grants were initially tied to a range of EV and electric‑truck projects.
Review and renegotiation
The grants were frozen last year as part of a broad review of green‑energy spending. In recent weeks the department has begun negotiations with the manufacturers to amend the terms. A senior DOE official said the Biden administration’s original selections “did not take into account market forces” and argued that EVs are no longer as cost‑effective as they were when the applications were submitted three years ago. The official added that the revised grants would also enable the production of related advanced car technology and that “the opportunity to create optionality was huge for this”.
Policy context
The move reflects President Trump’s agenda to revive domestic car manufacturing while expanding consumer choice. It also marks another step in rolling back the Biden administration’s green strategy, which had aimed to phase out gasoline‑powered vehicles. Since taking office, Trump has moved quickly to dismantle regulations that encouraged EV purchases and to eliminate generous tax incentives for EV buyers. According to the Energy Information Administration, those actions have coincided with a sharp fall in EV sales and a surge in hybrid sales, which now far outstrip EV sales.
Industry response
Stellantis said it was grateful the DOE is proceeding with the grants, which will be used to expand an assembly plant in Illinois and a transmission plant in Indiana. Volvo’s spokesman said the funding would help the company and its workforce become more competitive and would be directed towards increasing truck manufacturing in Pennsylvania, Virginia and Maryland.
The restructuring of the grants illustrates a shift in US federal support from pure electric vehicles to a broader mix of hybrid and advanced‑technology cars.