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Chinese Firm Wins Bid For US-Backed Battery Maker
theodp writes "On September 13, 2010, President Obama called A123 Systems from the Oval Office to congratulate them on opening the nation's first manufacturing facility to mass-produce electric vehicle batteries, which the White House noted was made possible by a $249 million Recovery Act grant the company received the prior August. 'When folks lift up their hoods on the cars of the future,' the President said, 'I want them to see engines and batteries that are stamped: Made in America. And that's what you guys are helping to make happen.' But on Saturday, the assets of A123 Systems were auctioned off to the Wanxiang Group, a large Chinese auto parts maker. Wanxiang agreed to pay $256 million for A123's automotive and commercial operations, including its three factories in the United States. Forbes reports that A123's stock, which closed at 7 cents a share on Friday, is now worthless."
Free market my ass. This is corporatism. Allow the corporation to do what they want at all costs. There is no reason that the government should NOT be allowed to designate that funds it spends benefits its citizens over other people. EVERY OTHER country in the world does this.
Let the nitpicking and the corporate hothead flaming begin below....
This is the free market in action. Would you rather the White House block the sale?
I'd rather the White House not give them $250M in taxpayer money in the first place. How exactly was that free market in action?
all the IP will go to the Chinese.
At least this time we got them to pay for it.
If Slashdot were chemistry it would look like this:Cadaverine
In a free market, a failing company would fail. In this case, the government took $249 million in tax dollars and gave it away. This is not the free market.
Love sees no species.
As of 2012 $129 million of the grant was used to build plants in Michigan (Romulus and Livonia); the remaining grant money has not been tapped (the grant was extended to 2014, but with the company in bankruptcy...) Originally Johnson Controls was going to buy (and use) the plants; it is still unknown if the plants will be used, but speculation is that at least one of the plants will be used. Note that the grants were backed by all of the Michigan members of Congress, despite the party. All of them wrote letters of endorsement to the DOE. The loan program that issued the grants was created in fall of 2008. The loan program predates Obama's presidency; the company applied in January and Obama because president January 2009. Please don't make this a partisan thread. This is what looked like a promising company that had a market in 2009 and needed to build manufacturing capacity - and the market disappeared (Chrysler closing its EV division was the major hit)
Because that is not how they play this game.
Look at how they dumped solar cells as a great example.
Public money is best spent on things private companies can't/won't do.
The best long term thing Government can do to help the country is finance research and education that form the building blocks for new companies. By comparison there are boat loads of investment dollars floating around in the private sector, the Government has no special way of knowing who the winners will be over private investors and the dollars are less needed there anyway. Financing companies is much riskier always, I guess I can see floating a loan to an established company in a crisis, but that is about it.
Republicans and, worse yet, Democrats both have become overly hypnotized with the power of "Private Enterprise". But people who run private companies are still just people. Better for Government to refocus on what is does well and assure plentiful funding for that. So if you really want to help produce electric cars, put out money for research at Universities and have open contracts for US manufacturers to sell the Government electric cars.
I'd like to say this is speculative investment,
No it wasn't. It was a grant , not a loan, not an investment. That means the government just gave them the money with no requirement or expectation that it would be paid back.
Yes, but I'd like to think the gov't doesn't just give away money for the hell of it.
'When folks lift up their hoods on the cars of the future,' the President said, 'I want them to see engines and batteries that are stamped: Made in America. And that's what you guys are helping to make happen.'
That sounds like an expectation to me.
We are being robbed.
How can you be robbed of something you gave away?
Because I didn't give it away. Some group of assholes did. Most of whom I did not vote for.
So using tax dollars to lower the price of your products to drive competitors out of business is competition?
So what is your bar for cheating?
Wanxiang has submitted the highest bid, but it has not been approved by the bankruptcy courts. There are a number of senators who are trying to have the buyout blocked because of A123's relationship with the Dept. of Defense. So while it's looking like our tech is heading East, it's not a forgone conclusion.
http://www.detroitnews.com/article/20121209/AUTO01/212090327/1148/rss25
remind me what would you call the "bailout" that saved some American banks
Graft and corruption
Aah, change is good. -- Rafiki
Yeah, but it ain't easy. -- Simba