The Department of Energy has preliminarily approved a $7.54 billion loan to support the construction of two electric vehicle (EV) battery factories in Kokomo, Indiana, by a joint venture between Stellantis and Samsung SDI. This significant investment is expected to create 3,200 jobs, as well as 2,800 operations jobs at the plants and hundreds more at a nearby supplier park.

The loan, which will be provided through the DOE's Advanced Technology Vehicles Manufacturing (ATVM) program, will be disbursed to StarPlus Energy LLC, a joint venture owned by Stellantis and Samsung SDI. The program was resurrected by President Joe Biden in 2022 to help fund the developing EV manufacturing industry in the US.

The Stellantis-Samsung project is expected to produce about 67 GWh of batteries, enough to supply approximately 670,000 vehicles annually when operating at full capacity. This investment is a significant boost to the US EV manufacturing industry, which has been gaining momentum in recent years.

However, the loan's approval is time-sensitive, as it needs to be finalized before Donald Trump takes office. Trump has promised to reverse or cancel much of the spending by Biden on EVs, including the $7,500 tax credit for new EV purchases and the rest of the spending from the Inflation Reduction Act (IRA). This could potentially impact the ATVM loan program, which has been instrumental in supporting the growth of the US EV industry.

The ATVM loan program has a storied history, having provided a timely $465 million loan to Tesla in 2009, which is credited with helping save the company from an early demise. However, the program went dormant during the first Trump administration, with many cash-strapped EV startups receiving no response to requests for funding.

Since its revival in 2022, the program has made several significant commitments, including a $2.5 billion loan to a joint venture of General Motors and LG Energy Solution to help fund the construction of a new lithium-ion battery manufacturing facility. Other beneficiaries of the program include a joint venture between Ford and SK Innovation, which received a $9.2 billion loan, and Redwood Materials, which received a $2 billion loan.

Stellantis, which owns brands like Jeep, Dodge, Chrysler, and Ram, as well as international brands like Peugeot and Fiat, is currently undergoing corporate upheaval. The company's CEO, Carlos Tavares, recently announced that he would step down amid a sharp decline in sales in the US and abroad. This could potentially impact the company's ability to meet the program's demands and fulfill its commitments to the EV industry.

Despite these challenges, the Stellantis-Samsung partnership is a significant step forward for the US EV manufacturing industry. The project's success will depend on the companies' ability to navigate the complexities of the industry and meet the program's demands. As the EV market continues to evolve, this investment is expected to play a critical role in shaping the future of the industry.

In conclusion, the conditional approval of the $7.54 billion loan to Stellantis and Samsung SDI is a significant development for the US EV manufacturing industry. As the industry continues to grow and evolve, this investment is expected to have a lasting impact on the sector and contribute to the country's transition to electric and software-defined vehicles.