By: Mark Glennon*
When has any company persisted with a project in the face of stronger local, statewide and national opposition? When have taxpayers subsidized a more harebrained project?
Never that we can think of, and that answer becomes clearer every day in the fiasco that is Gotion. The Chinese company with heavily documented ties to the Chinese Communist Party (CCP) is to receive $530 million from Illinois taxpayers and is eligible for $7.5 billion in federal tax credits to build a plant to make batteries for electric vehicles in Manteno, Illinois. It plans a similarly sized plant in Michigan, subsidized by that state.
Or maybe we shouldn’t worry about those CCP ties because the CCP is just like any other party, such as Democrats and Republicans, and the CCP doesn’t run China. That’s what Gotion’s U.S. spokesman told us Tuesday. His comments are among the recent news on Gotion, which we summarize here:
Leading Gotion opponent takes key role in U.S. House:
Rep. John Moolenaar, firmly opposed to Gotion’s plans, was named last month as chair of the U.S. House Select Committee on Strategic Competition between the United States and the Chinese Communist Party. Moolenaar’s district includes the site of Gotion’s proposed Michigan plant.
Federal water cut-off:
The U.S. House unanimously approved an amendment, sponsored by Moolenaar, that would prohibit the Environmental Protection Agency from issuing water permits to companies like Gotion that are controlled by U.S. adversaries. The projects would consume large amounts of water, with estimates ranging from 200,000 to 500,000 per day. “My amendment protects Michigan’s natural resources from being used by companies that are controlled by our nation’s foreign adversaries and it prohibits the EPA from issuing them any water permits. Under no circumstance should CCP-affiliated companies like Gotion be allowed to use Michigan’s water. This is commonsense legislation and I encourage the Senate to immediately pass this bill,” said Moolenaar.
Gotion Manteno project tied at the hip to Gotion Michigan project:
It’s now confirmed that the Illinois project will use parts to be produced in Gotion’s proposed Michigan plant. That’s key because an end or delay in the Michigan project likely means an end or delay to the Illinois project, and opposition to the Michigan project is intense. Confirmation that the Illinois plant would be downstream in production from the Michigan plant appears, among other places, in Gotion’s online town hall meeting held Tuesday, discussed below.
Despite that uncertainty, Illinois is already shelling out money for Gotion, having disbursed $125 million in January. No construction is yet evident at the Illinois site.
OPUD to the max:
Over promise and under deliver — that’s what’s materializing when it comes to Gotion. In announcing the Manteno project, Gov. JB Pritzker claimed it would begin production this year and ultimately employ 2,600. But when Chuck Thelen, Gotion’s U.S. spokesman, was asked about that in Tuesday’s internet town hall, he laughed and said, “I would love to do it next year but I don’t think it’s going to be possible.” He did go on to say that he is targeting the second or third quarter of next year, but he also said, “We would like to open January 2026, but it is all going to depend on the process for the permitting.” His laugh and initial response seem more realistic.
Because the Illinois plant will rely on parts from the Michigan plant, that means no production in Illinois until, well, you can interpret Thelen’s laugh as you wish and speculate yourself on the odds that it will survive its opposition.
Gotion’s promise of 2,600 jobs in Manteno also looks suspect. At Breakthrough Ideas, former Rep. Jeanne Ives took a look at recently discovered evidence:” It appears from the FOIAd correspondence above that Gotion only plans to have 300 people per shift for phase 1 and 2. If they have the need for 3 shifts, that would be at most 900 people. They promised 2600 jobs. Now, maybe subsequent expansion phases will require additional workers, but given the pullback of EV manufacturers, it is hard to believe that the Gotion plant will be at full capacity anytime in the next year, and certainly not with 2600 employees.”
Another tie between Gotion and Chinese Communist Party:
A director of Gotion’s U.S subsidiary has been pictured attending multiple Chinese Communist Party (CCP) meetings, according to a Daily Caller News Foundation review of the website of the firm’s China-based parent company. Moolenaar slammed Gotion again over the news, saying, “Gotion officials in Michigan continue to mislead residents about the company’s ties to the Chinese Communist Party. Gotion Inc. officials are actively involved in the CCP…. Gotion is the wrong business partner for Michigan.” Many other Gotion ties to the CCP are already documented.
Race card:
Gotion announced late last month that it will be taking a “more vocal defense” of alleged false information about it. Thelen said then that Gotion is trying to “dispel the whole Asia-hate thing that we’re definitely seeing around the United States right now and trying to show why it’s misplaced”. And “xenophobia” was among the characterizations made by Thelen about opponents on Tuesday.
Further disastrous news electric vehicles sales:
Even Tesla, the U.S. leader for EV sales and the only one that sells them profitably, is faltering. This month it reported a 20% sales decline from the previous quarter and an 8% decline year-over-year, its first ever year-over-year decline. Other EV makers continue to suffer, not hitting nearly the sales growth needed to achieve profitability. In fact, U.S. EV sales are down 7% so far this year compared to the same period last year.
Illinois litigation continues:
Nothing is expected to happen on the lawsuit filed by Gotion opponents in Illinois until July, when the first hearing on a motion to dismiss is scheduled.
More nonsense from Gotion in its town hall:
The real doozies from Thelen on Tuesday came when asked about the new allegation discussed above about the connection between the CCP and a key Gotion executive. See it yourself at the 35-minute mark here. Thelen said he only asked that person once about his CCP connections, and was told, “Nobody in this company discusses that…. It does not belong in our company….It’s nobody’s business. It’s unprofessional and inappropriate to discuss that at work,” and Thelen repeated the same point multiple times.
Yet Thelen repeatedly claims he knows there is no CCP connection to Gotion.
Unbelievably, Thelen went on to say that “the CCP is a political party like Republican or Democrat people that run the country in the PRC [the Peoples Republic of China].” Does he really not know how China is run? Or does he think Americans don’t know?
Thelen also characterized Gotion opposition as “a small minority of people that continue to identify with some extremist groups.” In fact, polls in Illinois and Michigan show majority opposition across both states, especially in the communities where the projects are planned. And even Democrat Leon Panetta recently warned about the national security threat Gotion represents in sworn testimony before Congress. Panetta served in the Obama Administration as Secretary of Defense and CIA director.
The Daily Caller spoke to Michigan residents who were very disappointed with the town hall and claimed their questions were not even presented. Watch it yourself and ask if it didn’t look rigged.
Former U.S. ambassadors Peter Hoekstra and Joseph Cella reacted to Gotion’s town hall by telling this to The Midwesterner: “This deal is corrupted from head to tail and everyday citizens know it. Whether it comes about the questionable nearly $1 billion Michigan taxpayer subsidy for a PRC-based and CCP-tied company worth $40 billion, to the binding and punitive five- and 10-year nondisclosure agreements that shrouds the ‘deal,’ to the scaling national security threat presented by the PRC and the CCP that other states and countries around the world are seeking to counter.”
In Illinois, Pritzker has expressly refused to answer any questions about Gotion, saying only, “MAGA Republicans have made themselves so irrelevant that they have to rely on xenophobia to gin up controversy for their base.” Illinois media have obliged and asked no questions.
*Mark Glennon is founder of Wirepoints.
For further reading on Gotion see our earlier columns collected here.
The bill passed despite their votes in response to certain incidents where local prosecutors are thought to have been too lenient with non-citizens assaulting cops.
The Wall Street Journal Editorial Board cited Wirepoints’ analysis of Chicago student proficiency data in their latest piece condemning the Chicago Teachers Union’s outrageous contract demands…all while a vast majority of Chicago’s children graduate unable to read at grade level.
Ted joined Tom Miller of WJPF to talk about the details of Gov. Pritzker’s proposed $52 billion budget, why the state is struggling now that federal covid dollars have run out, the controversy surrounding Tier 2 government pensions, why Illinois’ expensive education system fails to teach children to read, the outrageous demands of the Chicago Teachers Union, and more.
Ted joined Jeff Daly to discuss how politicians can never spend enough on education despite there being no accountability for that spending, the growth of education staffing across Illinois, Mayor Brandon Johnson’s $1 billion demand for Chicago schools, why Gov. Pritzker is providing $830 million in taxpayer subsidies to struggling EV carmaker Rivian, and more.
Think about the agenda they are pushing, the EV cars. This is going to be crammed down everyone’s throats until you get an EV so they can do their 15 minute city agenda. Wondering why they are pushing all businesses out of these big cities. They want to empty out the big cities so then they can make it all apartment buildings, 15 minute cities so they can achieve their, you will own nothing and be happy by 2030 agenda. Remember the “great reset” from the plandemic scam they ushered in in 2020, and “new normal”. This is it. Here… Read more »
Just like the crime happening in the big cities, you think it’s just a coincidence it’s happening all over the place. They are creating a new problem so they can come in with their solution which is probably martial law. They are making it so bad that people will be begging for it. Look at NYC, the installed puppet governor is doing exactly as she is told, put the military in the subway; yeah that’s not being done on purpose by the cult that runs everything. Stop buying into the fake left right political paradigm, it’s fake, your vote doesn’t… Read more »
Just wait till everyone figures out and realizes that that CIA installed Xi in China and the illuminati controls both parties here in the US so no matter what party you vote for you get the exact same agenda. Trump and Biden just like good old George W Bush and John Kerry, both members of the skull and bones; don’t believe me just go youtube it. lol
Thank you Mark for this very informative article. I am one of the leaders in the anti Gotion fight in Michigan.
Gotion has facilities in California, Germany, Japan, China, Singapore and a second one in the US. America is turning into a whiney baby. We can’t make EV batteries, China is a decade ahead of us at that. What do we expect? We must use Chinese batteries, we have no choice. Yet we whine about such macro factors like “communism”, “freedom”, “spys” when another culture wants to help us out of our feeble inability to make our own damn batteries by opening a shop locally. We just let millions of “spys” and “inferior cultures” across our border. Chinese companies are all… Read more »
Good grief. For starters, we do have a choice to use batteries from other places, and we already do. Maybe China is the leader, but their lead is marginal, and there are other makers often used, even from other nations, which would be fine. Panasonic, for example, has a US subsidized plant under construction in Kansas. Just a third of Tesla’s batteries are from China. And you think $8B in subsidies paid to a foreign company for a plant that will cost just $3.5B to construct is sensible? Finally, you say we “whine” about such macro factors like “communism”, “freedom”,… Read more »
Mark, People who are not engineers, lawyers, bankers, politicians, social workers, etc. have no clue how much dominance China has in mfg. over the US and every western nation. They produce real value, we produce debt. There are thousands of examples I can give for whats really happening, below is just one scenario. Gotion is a natural economic response to reality, its not a sinister plot. Your response ended with an insult, which is generally the first sign someone has no argument or desire to discuss. So below is one little example of my “subservience”, even though others long ago… Read more »
Just in case there is some disbelief about my $2 claim…
PCB Prototype & PCB Fabrication Manufacturer – JLCPCB
The situation is far more nuanced than your comment implies. The guest on Dan & Amy, Steven W. Mosher, this morning speaking about China was very astute and knowledgeable. Granted, he’s biased, but he’s not wrong. He said there are two Chinese economies – the coastal economy that produces things for export and is profitable, and then every thing else. And everything is subsidized by government debt which greatly grew after the 2008 crisis spurred the government to go heavily into debt, both nationally and in the local areas, most of which is ‘off the books’ so to speak. And… Read more »
Actually they are of superior quality to American PCB’s and all pricing/quoting is instantaneous automated, no salesmen to deal with like the American companies, no waiting for jacked up quotes. And their engineers answer 24/7 with questions about the design. JLCPCB also supplies our production boards and do the part insertions. China also supplies much of our pharmaceuticals and chemical pre-cursors to make drugs.
Rick, giving Gotion $8 billion to build a $3.5 billion plant sure as heck is no “natural economic response to reality.” I am well aware of China’s dominance in many sectors and, as a free trader, much of it does not bother me. But paying them to expand that dominance in a critical industry that many believe is “the future” (EVs) is foolhardy. Moreover, I do not believe that that future is here because EVs just aren’t ready and consumers don’t want them. That, to me, means that even if Gotion were wholly American, this investment is an extremely risky… Read more »
Mark, All valid arguments, solid, I don’t think it is a good investment for the state, for all these factors too. My problem is when societal, philosophical, moral, race, or Chinas other contracts around the world, etc. become somehow the reason for not letting Chinese actors in Illinois. So much around this issue devolved to just that. Comparing the CCP to political parties elsewhere is irrelevant, neither is gonna change, do we stop importing Insulin from China over this comparison as well? The only argument should be if a deal is gonna succeed or fail for Illinois after the start… Read more »
Sell your apple phone and watch. Go back to a land line.
Sell your computer and tv all made with Chinese parts.
Are they subsidized by US taxpayers?
Spot on, if Gotion is lucky enough to leave Illinois it will be the best thing that they could do.
Let all the anti-businesspeople provide new factories for workers.
I just got off my Chinese built Apple phone, great phone.
Illinois does NOT NEED new jobs; it is just fine the way it is. Just ask Ken Griffin, they told him not to let the door hit him on the way out. More and more people are leaving the state every day.
Gotion will be sorry they moved to Illinois. Lots of other states would have given them money.
Anyone who creates jobs should be chase out of state.
I have not heard a single good argument for stopping this, other than the cash hand out and tax breaks all valid. But hand outs and tax breaks can be negotiated, and states compete to give those benefits to companies all day long. That is all simply ROI work, due diligence, etc. But all the arguments about “communism”, “spies”, “plots” discredit the valid economic arguments for or against, the economics are the only valid argument. These Chinese companies have amazing talent to deliver the goods once their facilities are up. If we want batteries at a good price, these companies… Read more »
My argument against the plant is that it is unlikely to ever be built given China’s domestic economic problems, the lack of interest in EV’s, and an over-saturation of the lithium battery market. As for the hand outs and tax breaks, those are substantial and should not be flippantly dismissed. As for Russia Russia Russia! The comparison is not correct. The problem with Chinese factories opening around the world is we see the way things are done by China in foreign countries and it’s inconsistent with American values. Do you know that China refers to Africa as the colonies? They… Read more »
Of course EV’s will fail at this time in a vast country like the US with a population that simply doesn’t want EV’s. Dealer lots have a 300 day supply. Thats probably the best argument for the state to not invest. But then again due diligence is a valid process that should expose that risk, making it a valid argument. What goes on in China and agreements they work out elsewhere is not an argument for this plant, comparing apples to oranges. And “American values” mean little around the world these days, we start wars for no reason other than… Read more »
Kinda like Thelen saying CCP no different than Dems or Republicans. I disagree.
Rick, if you want the ROI analysis to control, then let it. That’s what the market does, but the government has overridden the market on this for crass political reasons — Pritzker bragging about a lousy 2,600 jobs (which probably won’t happen). And your dismissal of the industrial espionage threat flies in the face of a long list of foreign policy experts from both sides of the aisle. China has robbed us blind on tech and they continue to do so. Trade with them, yes, but avoid projects in which know-how will further accrue to them, which would be the… Read more »
China has not robbed us of our intellectual property. Since the 80’s American companies have freely handed it to them. A company cannot ask a Chinese company to make a TV or a network router, unless they tell them, in detail the schematics, the math, the voltages to test at every test point, everything. It took 40 years but it happened. I recall in 1983 China foundries not even aware of how to design American style iron bench vices, not the reverse threaded German vise, but a regular voce. But we handed them that design at the start of Chinas… Read more »
This is flat out wrong, China does steal ip: https://www.bbc.com/news/world-asia-china-64206950 Industrial espionage: How China sneaks out America’s technology secrets “It was an innocuous-looking photograph that turned out to be the downfall of Zheng Xiaoqing, a former employee with energy conglomerate General Electric Power. According to a Department of Justice (DOJ) indictment, the US citizen hid confidential files stolen from his employers in the binary code of a digital photograph of a sunset, which Mr Zheng then mailed to himself. It was a technique called steganography, a means of hiding a data file within the code of another data file. Mr… Read more »
I hope the U.S. Government did a proper evaluation of whether Gotion setting up shop in Manteno is a national security risk.
I find it funny how jack Ma criticized the CCP and then he disappeared for months. When he reappeared he seemed to have an attitude adjustment toward the CCP. Funny how that happened.
When he’s not dreaming of food, JB dreams about having the power of just another political party like the CCP.
Too bad JB is the governor of MAGA Country. Not sure how he was even able to get elected in a state where everyone wears a red MAGA hat.
To my loyal downvoter, thank you for your undivided attention and devotion. I feel your love.
I only have one question: Why do you live in MAGA Country Illinois?
Send them and the Illegals packing………be smart!!