- Chinese battery giant Gotion High-Tech wanted to bring local manufacturing of lithium-ion batteries to Michigan.
- The state’s economic development corporation initially backed the plant, but has since rescinded its support.
- Gotion wanted to train American workers to make cutting-edge batteries and had promised 2,350 high-paying jobs.
In 2022, the Chinese company Gotion High-Tech began construction of a $2.4 billion battery factory in Northern Michigan, promising 2,350 high-paying jobs and one of the state’s largest economic development projects.
The State of Michigan promised more than $100 million in subsidies to the battery company, of which it had already disbursed over $23 million to help Gotion acquire land near Big Rapids. But the state’s economic development division is now asking for that money back and has canceled the remaining subsidies promised to the company, Crain’s Detroit Business reported Thursday.
Gotion High-Tech is one of the world’s largest battery manufacturers, accounting for 3.6% of the global cell manufacturing capacity between January and August of this year—which nearly equals Panasonic—according to Korean market research firm SNE Research.
It specializes in lithium iron phosphate (LFP) batteries and traditional nickel manganese cobalt (NMC) packs. The company also started pilot production of its Gemstone solid-state batteries in China this year, which it says can deliver more than 620 miles of range (1,000 kilometers) when they enter commercial production.
The company wanted to bring its battery expertise to America, but has been roiled by controversies since construction began in Green Charter Township in 2022. Michigan lawmakers said the company had violated its grant agreement, as there were no eligible activities at the site for more than 120 days.
Even before this alleged default, the Green Charter Township has been pressuring Gotion to cancel its battery project. Local leaders accused the company of having links to the Chinese Communist Party, something the company has denied. A vote in 2023 ousted the township board members who had approved the project, and they were replaced by those who completely opposed it.
“These well-documented challenges, false accusations and politically motivated attacks were not through any actions or inactions by Gotion, but solely due to racist and ethnically charged stereotypes that led Green Charter Township to breach the parties’ Development Agreement,” Gotion attorney Mark Heusel said in response to the pullback of the state incentives, Crain’s Detroit Business reported.
The battery plant would have directly “helped China,” Michigan representatives have previously said, without elaborating exactly how.
In reality, China has already been helping itself. It has the latest and greatest battery technology and more than enough local production capacity to serve both domestic and global demand. In fact, China has now restricted the export of key technologies to consolidate its lead, leaving the U.S. further behind in this technological race.
If anything, it’s America that needs the help, having been left in the dust by Chinese companies whose EVs and batteries are so advanced they make U.S. offerings look dated.
The Michigan Economic Development Corporation once hailed the Gotion project, saying the company would train American workers and add thousands of indirect jobs, in addition to 2,350 direct jobs. But now this cancellation adds to several other large-scale battery projects that have been rescinded recently amid the Trump administration’s attack on clean energy projects.
Still, it’s unclear if the Gotion factory would have made economic sense. With the rollback of the $7,500 federal tax credit, analysts expect EV demand to plunge in the coming months. And research firm BloombergNEF has forecasted that America’s battery production is on track to exceed demand by the end of the decade.
Unless there’s a surge in demand or if the U.S. government reinstates some of its pro-EV policies to jumpstart adoption, cancellations like these hardly come as a surprise.
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