Trump’s DOE Plans to Slash Billions in Grants for GM, Ford, and Startups
The Department of Energy is poised to implement significant cuts to federal funding, potentially impacting numerous startups and major automakers such as Ford, General Motors, and Stellantis. According to an internal document reviewed by TechCrunch, the proposed cuts could cancel over $500 million in contracts awarded to more than a dozen startups. This decision follows the Trump administration’s announcement last week of more than $7.5 billion in contract reductions. The implications of these cuts could be far-reaching, affecting both emerging companies and established industry players.
Impact on Startups and Automakers
The proposed funding cuts are primarily aimed at grants awarded under the Bipartisan Infrastructure Law, which were intended to support innovative projects across various sectors. Startups that were set to benefit from these grants now face uncertainty regarding their operations and future projects. Notably, General Motors could lose at least $500 million from a federal Domestic Manufacturing Conversion Grant, which was earmarked for retooling the Lansing Grand River Assembly Plant in Michigan. This facility is crucial for GM’s plans to produce electrified vehicles, including hybrids, starting in July 2024.
Other major companies, including Daimler Trucks North America, Harley-Davidson, and Volvo Technology of America, are also at risk of losing substantial funding. The document reviewed by TechCrunch indicates that these proposed cuts could significantly hinder the development of new technologies and manufacturing capabilities in the automotive and transportation sectors.
Significant Awards at Risk
Among the most notable awards facing cancellation are two grants exceeding $100 million. One of these is a $189 million grant to Brimstone, a materials startup focused on producing Portland cement and alumina with reduced carbon emissions. The other is for Anovion, a Chicago-based startup aiming to establish a factory for domestic synthetic graphite production, a critical component for lithium-ion batteries. Currently, the graphite market is largely dominated by Chinese companies, making this initiative particularly important for U.S. supply chain independence.
Additionally, battery materials startup Li Industries, which received $55.2 million to recycle lithium iron phosphate (LFP) batteries, is also among those affected. The funding was intended to help the company secure a foothold in the battery recycling market, which is increasingly vital as electric vehicle adoption grows.
Broader Implications for the Industry
The proposed cuts extend beyond startups to include several companies in the building materials sector. For instance, Sublime Systems, based in Somerville, Massachusetts, was awarded $86.9 million to construct an ultra-low-carbon cement plant, while Mountain View’s Furno was set to receive $20 million for a demonstration project involving a novel cement kiln. Other companies, such as CleanFiber and Hempitecture, which produce insulation materials, are also at risk of losing significant funding.
Interestingly, one of the proposed cancellations appears to contradict the administration’s stated goals of advancing energy and artificial intelligence technologies. TS Conductor, which could lose $28.2 million, specializes in advanced conductors for electric lines that could enhance the capacity of existing transmission systems. This technology is crucial for alleviating grid bottlenecks and improving power delivery to data centers.
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