American politics is once again intertwining with the auto industry in a way that threatens to shake Detroit’s plants. According to the Detroit News, an internal planning document from the Trump administration reveals the intention to cancel more than a billion dollars in federal subsidies destined for General Motors and Stellantis, with about $800 million concentrated in the State of Michigan.
Trump administration plans to cancel $1 billion in federal grants to GM and Stellantis
The dossier, leaked from Capitol Hill, is part of a larger package of Department of Energy projects worth a total of over $16 billion distributed across a dozen American states, some of which had supported Trump in the 2024 elections. A set of numbers that, if confirmed, would have significant effects on the Midwest’s industrial economy.
The news comes at a delicate moment, with the federal government shut down and the President accusing Democrats of immobilism, threatening to cut key programs if new budgets aren’t approved. Some of the projects involved had already been suspended months ago, but the plan risks hitting crucial investments related to the electric transition as well.
Among these is Stellantis‘ Belvidere, Illinois project, which was supposed to receive $335 million for the plant dedicated to electric vehicles, later converted to Ram pickup production by 2027. Another allocation of $250 million was planned for the modernization of the Kokomo, Indiana plant, intended for the production of electric propulsion modules. For now, the group has not officially commented.
In recent months, the Republican administration has already reduced federal support for electrification, eliminating tax credits, emissions penalties and some rules on zero-emission vehicle sales. Trump considers the shutdown an opportunity to “eliminate waste and fraud”, but the announced cuts risk heavily slowing the industrial plans of major American automakers.
For its part, the Department of Energy has tried to calm the waters. Spokesperson Ben Dietderich stated that “this is not a revocation of funds”, but “a review of projects initiated by the previous administration.” However, the prospect of a downsizing of aid remains concrete and could compromise billions of dollars of investment in the U.S. automotive sector.
