WASHINGTON (Reuters) - The Obama administration on Wednesday said it will give more than $175 million to car companies and research centers to spur clean auto technology and production of advanced car batteries.
The announcement came ahead of President Barack Obama’s visit to a battery factory in Michigan, and followed the introduction of the country’s new standards for auto fuel efficiency and greenhouse gas emissions.
“The Department of Energy is investing in new advanced technologies that will significantly improve vehicle fuel economy, save consumers money, and create skilled jobs for Americans,” U.S. Energy Secretary Steven Chu said in a statement on Wednesday.
Clean energy, fuel independence and job creation are cornerstones of Obama’s reelection campaign. Aiding U.S. automakers serves to counteract criticism that his clean-fuel auto agenda gives competition away.
On Thursday, President Barack Obama Obama tours a factory run by Johnson Controls that produces lithium-ion batteries, used in electric-powered vehicles. The plant was also funded by government grant money.
General Motors Co, Ford Motor Co and Chrysler Group LLC, controlled by Fiat SpA, are among the companies that received funds to develop more efficient fuel and lubricants, more lightweight materials, and more efficient conventional batteries. A dozen projects are also devoted to making cheaper and longer-lasting electric batteries.
By 2015, the United States will be able to produce half a million plug-in and hybrid vehicles and 40 percent of the world’s advanced batteries, Heather Zichal, Deputy Assistant to the President for Energy and Climate Change, said.
Under the fuel efficiency standards, auto makers must improve fuel efficiency of cars and light-duty trucks to reach an average of 54.5 miles per gallon by 2025. Commercial trucks, vans and buses will reduce fuel consumption and greenhouse gas emissions by about 10 to 20 percent, depending on their category, by 2018.
Americans will save $1.7 trillion at the pump and commercial vehicle owners will save $50 billion in fuel costs over the life of the respective programs, according to government estimates. The two initiatives are part of Obama’s plan to cut U.S. oil imports by a third before 2025.
Obama’s trip on Thursday will be his second to Holland, Michigan. Last July, he visited a lithium-ion battery plant owned by LG Chem, which was also subsidized in the government initiative to build new car battery factories in the United States.
Reporting by Lily Kuo; Editing by Gary Hill