The auction for the assets and business of green stimulus recipient A123 Systems has been won by Chinese auto parts manufacturer Wanxiang Group, which aggressively sought the electric vehicle battery maker at least since the summer.
The successful bid – reported to be about $260 million – follows weeks of warnings by the U.S. government, congressmen and a group of former military and other leaders that transfer of the Massachusetts-based company would compromise American jobs, technology and security. The auction attempts to address some of those concerns, as Wanxiang was not awarded any of A123’s contracts with the U.S. Department of Defense. Instead the company’s “government business,” including all its military contracts, was awarded to Illinois-based Navitas Systems.
The Chinese government, unsurprisingly, has approved a potential sale of stimulus-funded ($279 million-plus) A123 Systems to one of its own automobile parts manufacturers, should the Wanxiang Group’s bid be the highest this week for the bankrupt electric vehicle battery maker.
That was the easy part.
So far Republican Sens. Charles Grassley (Iowa) and John Thune (S.D.) have repeatedly raised questions and concerns about the possible transfer of A123’s business, jobs and technology from the U.S. – where taxpayers have thrown in approximately $132 million only to see many times that amount in losses since its 2009 initial public offering – to China. They’re no longer the only voices speaking out against the transaction.
The little-reported bankruptcy of a relatively small electric vehicle battery manufacturer last month illustrates the many problems with President Obama’s green energy stimulus program, and why the more appropriate location for the ramblin’, gamblin’ White House might be Las Vegas.
A123 as a whole, or in pieces, is going to be sold to the court-approved buyer(s). That is likely to be either Johnson Controls, which is the lead bidder for the company’s automotive business, or Wanxiang Group, which wants to buy the whole company. A123 had an agreement to transfer up to 80 percent of the company’s ownership to the China-based automotive parts manufacturer over the summer, but its bankruptcy filing on Oct. 16 – with Johnson Controls as the new automotive assets purchaser – nullified its agreement with Wanxiang.
President Obama’s penchant for flushing taxpayer money down the green energy toilet lives at least another four years, and his crony supporters continue to benefit.
The latest example is the pending sell-off of assets by bankrupt A123 Systems, which was awarded upward of $279 million in stimulus funds, plus other assorted government grants and contracts. The top executives who presided over its failure – and supported the president’s cap-and-tax initiatives early in his term – are likely to receive millions of dollars in bonuses, thanks to their scheming earlier this year and a bankruptcy court judge.
But now the taxpayer-subsidized ($193 million) electric automaker has seen several of its $102,000+ luxury hybrids go up in smoke all at once, thanks to Hurricane Sandy.
Jalopnik.com reported Tuesday night that approximately 16 of the Karmas that were parked in Port Newark, N.J. Monday night as Hurricane Sandy approached were submerged by the storm surge. According to the Web site’s unidentified source, the vehicles then “caught fire” and “exploded.” Jalopnik has exclusive photos of the Karmas in which they all were thoroughly destroyed by what must have been an intense inferno.
In August the Massachusetts stimulus recipient (more than $279 million, plus a bundle of other government contracts) announced that Wanxiang Group would infuse the failing company with quick cash as part of a plan to assume as much as 80-percent ownership. A barrage of questions and concerns followed – most prominently from Republican Sens. Charles Grassley (Iowa) and John Thune (South Dakota) – about the logistics of the deal, the potential relocation of taxpayer-funded jobs overseas, and the protection of U.S.-financed technology. Required approval by both the Chinese and U.S. governments seemed to be a high hurdle.
A story that went viral over a week ago showed how (non)-workers at a Michigan electric vehicle battery plant, funded through the stimulus by taxpayers, spent their time playing games, reading magazines, watching movies or helping charities like Habitat for Humanity – that is, when they weren’t ‘off-duty’ on their cyclical furloughs.