Tennessee Hybrid Vehicle Manufacturing Conversion Grants

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Please note this grant offering is still under development.

The application window is anticipated to open in January 2027.  See below on this page for information about workshops being hosted on September 23 and September 29.

Program Overview

The Tennessee Hybrid Vehicle Manufacturing Conversion Grants Program is a competitive subgrant program funded through the Inflation Reduction Act (IRA), Section 50143: Domestic Manufacturing Conversion Grants for Electrified Vehicles.

The U.S. Department of Energy (DOE), Office of Manufacturing and Energy Supply Chains (MESC), awarded Tennessee $5,555,068 to support small and medium-sized manufacturers (SMMs) in transitioning from internal combustion engine (ICE) vehicle and component production to hybrid vehicle and related hybrid vehicle component manufacturing.

Available Funding

TDEC anticipates awarding 5–10 competitive subgrants to eligible Tennessee manufacturers.

  • Minimum Award: $500,000
  • Maximum Award: Approximately $1,000,000
  • Required Cost Share: At least 50% of total project cost

Subgrant funds may be used to support manufacturers in transitioning from ICE vehicle and component production to hybrid vehicle and related hybrid vehicle component manufacturing.:

  • Retooling and modernization of manufacturing facilities
  • Purchase and installation of manufacturing equipment
  • Integration of hybrid vehicle production technologies

Subgrantees must incur and pay eligible costs prior to requesting reimbursement. No pre-award costs are eligible.

Eligible applicants must:

  • Operate a manufacturing facility located in Tennessee
  • Fall within North American Industry Classification System (NAICS) codes 3361, 3362, or 3363 (motor vehicle and parts manufacturing)
  • Employ fewer than 500 employees at the applying facility
  • Have annual revenue below $250 million
  • Currently manufacture ICE vehicle equipment, components, or systems
  • Propose a project that transitions production toward hybrid vehicle or hybrid vehicle component manufacturing

Eligible projects must support the conversion of ICE-related manufacturing facilities to Hybrid vehicle or component production.

Projects should include:

  • A clearly defined retooling strategy
  • A workforce retraining plan
  • Measurable performance milestones
  • A realistic three-year implementation timeline

Projects must be completed within the subgrant performance period.

All work funded through this program must be performed in the United States.

Upcoming Workshops

The Tennessee Department of Environment and Conservation – Office of Environmental Stewardship, in collaboration with the Tennessee Manufacturing Extension Partnership (TMEP) is hosting two upcoming workshops for Tennessee-based facilities that manufacture internal combustion engine-related vehicle equipment, components, or systems. These workshops will provide an overview of the new Hybrid Vehicle Manufacturing Conversion Grant Program and TMEP’s technical assistance offerings to prospective grant applicants to evaluate facility readiness for entering the hybrid vehicle manufacturing space.

Attendees can register for either workshop to learn about eligibility, eligible projects, and roadmapping assistance for transitioning from internal combustion engine-related manufacturing to hybrid vehicle or component production.

Please see the graphics below for additional details, and feel free to share this opportunity with Tennessee manufacturers who may be interested.

Contact Chris Pianta at Christopher.Pianta@tn.gov with any questions regarding the workshops.

Virtual Grant Workshop

The virtual workshop will be held on Wednesday, September 23, from 10:30-11:30 a.m. CST.

Image of the Hybrid Vehicle Manufacturing Conversion Grant: Applicant Workshop for Tennessee Manufacturers. Virtual Grant Workshop. This workshop will cover Tennessee's Hybrid Vehicle Manufacturing Conversion Grant Program and guide manufacturers interested in applying for funding. Attendees will learn about eligibility, eligible projects, cost share, and road mapping assistance for transitioning from internal combustion engine-related manufacturing to hybrid vehicle or component production. 10:30 - 11:30 am CST Wednesday, September 23, 2026. UT, Center for Industrial Services Institute for Public Service, and TN Department of Environment and Conservation. This material is based upon work supported by the U.S. Department of Energy's Office of Manufacturing and Energy Supply Chains under award Number DE-MS0000153

In-Person Workshop

The in-person workshop will be held on Tuesday, September 29, at 9:00 a.m. CST at the Fleming Training Center in Murfreesboro (2022 Blanton Drive). This event will also give participants direct access to program experts who can answer questions and provide additional guidance.

Image of the Hybrid Vehicle Manufacturing Conversion Grant: Applicant Workshop for Tennessee Manufacturers. In-Person Grant Workshop | Murfreesboro, TN. This workshop will cover Tennessee's Hybrid Vehicle Manufacturing Conversion Grant Program and guide manufacturers interested in applying for funding. Attendees will learn about eligibility, eligible projects, cost share, and road mapping assistance for transitioning from internal combustion engine-related manufacturing to hybrid vehicle or component production. 10:00 am CST Tuesday, September 29, 2026. Flemming Training Center 2022 Blanton Drive, Mufreesboro, TN 37129 UT, Center for Industrial Services Institute for Public Service, and TN Department of Environment and Conservation. This material is based upon work supported by the U.S. Department of Energy's Office of Manufacturing and Energy Supply Chains under award Number DE-MS0000153

FAQs

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Contact

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Mark Valencia

Special Programs Coordinator
Office of Environmental Stewardship

mark.valencia@tn.gov
615-934-5826

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