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Can Detroit go green?

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Despite getting $1.4 billion in federal stimulus grants in August for advanced battery and electric-vehicle work, the state is locked in a global technology race. Electric-vehicle work for the Department of Energy will be performed in nearly 30 states, with Indiana and Missouri receiving some of the most money after Michigan. Southeast Asian companies also have been developing lithium-ion battery technology for years, such as LG Chem and Korea-based Kokam Company, which is partnering with Dow Chemical Company in Midland, Mich., to do federal electric-vehicle work.

So far, Michigan has assembled a number of promising companies, including auto supplier Magna International of America. The Troy, Mich., firm won $40 million from the Department of Energy to expand two electric-drive-system manufacturing sites in Muncie, Ind., and Holly, Mich. That’s in addition to $3.4 million in state tax credits approved in March to expand another facility that makes electric and hybrid vehicle components. Magna is also working with Ford on the BEV, an all-electric sedan set to appear in 2011, and is producing lithium-ion battery systems for Volvo Group. “As people are spending money in R&D and the volumes go up, you’ll start seeing the costs come down, especially with the incentives we’re seeing from the various governments,” said Don Walker, joint CEO, in an August conference call with analysts. “So it’s going to be a fairly material part of our business when you look out five, 10 years down the road.”

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