Today’s Broken Promise: Obama Hands The Keys To A123 To China

THEN: Two Years Ago Today, Obama Called Electric Battery Maker A123 Systems And Said The Company “Will Help Power The Economy For Years To Come.” OBAMA: “But most of all, I want to congratulate and thank all the men and women of A123 Systems. You guys are making us proud. The work you’re doing will help power the American economy for years to come.” (President Barack Obama, Remarks by the President in Phone Call to Recovery Act Advanced Battery Grant Recipient, A123 Systems, Washington D.C., 9/13/10)

  • “When President Obama Announced 90-Billion Stimulus Tax Dollars For Green Energy, A123 Stepped Up For A Slice Of The Pie.” “When President Obama announced 90-billion stimulus tax dollars for green energy, A123 stepped up for a slice of the pie. It spent $1 million lobbying Congress and federal agencies, and won 249 million in stimulus dollars.” (Sharyl Attkisson, “Electric Car Battery Company Hits Road Bumps,” CBS News, 6/7/12)

NOW: The Washington Post: “A Chinese Company Had To Buy Out Distressed A123, To Which The Energy Department Has Committed $263 Million In Production Aid And Research Money.” “As these companies flail, they are taking the much-ballyhooed U.S. advanced-battery industry down with them. A Chinese company had to buy out distressed A123, to which the Energy Department has committed $263 million in production aid and research money. Ener1, which ran through $55 million of a $118 million federal grant before going bankrupt, sold out to a Russian tycoon.” (Editorial, “GM’s Vaunted Volt Is On The Road To Nowhere Fast,” The Washington Post, 9/12/12)

  • China’s Wanxiang Plans To Invest $450 Million In Obama-Funded A123 Systems, Taking 80 Percent Stake. “China’s largest automotive parts supplier is poised to take control of U.S. battery maker A123 Systems (AONE.O), which received $249 million green-technology grant from the Obama administration in 2009. China’s Wanxiang Group Corp plans to invest up to $450 million in A123 Systems, taking an 80 percent stake in the U.S. company, A123 said on Wednesday.”(A. Ananthalakshmi and Paul Lienert, “China’s Wanxiang To Take Control Of Battery Maker A123,” Reuters, 8/8/12)
  • Wanxiang Is “One Of The Largest Non-Government-Owned Companies In China” And Has A U.S. Subsidiary Based Outside Chicago. “Wanxiang, one of the largest non-government-owned companies in China, with annual revenue of more than $13 billion, has an electric vehicles subsidiary in Hangzhou and a U.S. subsidiary based outside Chicago. The parent company supplies auto parts to many of China’s largest automakers.” (A. Ananthalakshmi and Paul Lienert, “China’s Wanxiang To Take Control Of Battery Maker A123,” Reuters, 8/8/12)

Obama Predicted That A123 Systems Would Create 3,000 Jobs, But Last Fall Only Had 690 Employees And Was Announcing Forced Layoffs. “A123 Systems, a battery maker that received $380 million in government support, announced recently that declining orders had forced layoffs. Instead of up to 3,000 new Michigan jobs as Obama and the company had predicted, it now has 690 employees.” (Carol D. Leonnig, and Joe Stephens, “For Obama’s Green-Car Revolution, Fits And Starts,” The Washington Post, 12/7/11)

  • Nasdaq Has Threatened To Delist A123 Is Their Share Price Does Not Recover In Six Months. “A123 Systems Inc (AONE.O), a lithium-ion battery maker backed by a $249 million U.S. government grant, received notice from the Nasdaq this week that its stock price is too low for exchange standards and will be delisted if it does not recover to $1 in the next six months.” (Mridhula Raghavan and Deepa Seetharaman, “A123 Gets Delisting Notice From Nasdaq,” Reuters, 8/22/12)
  • A123 Warns It Has Enough “Cash To Fund Its Operations For Only The Next Four To Five Months.” “A123 warned last month that it had cash to fund its operations for only the next four to five months. A123 received more than $200 million from venture investors before raising $378 million in a 2009 initial public offering. That same year, it was awarded a grant under the Obama administration’s $2.4 billion Electric Drive Battery and Component Manufacturing Initiative.” (A. Ananthalakshmi and Paul Lienert, “China’s Wanxiang To Take Control Of Battery Maker A123,” Reuters, 8/8/12)

The Washington Post: “No Matter How You Slice It, The American Taxpayer Has Gotten Precious Little For The Administration’s Investment In Battery-Powered Vehicles …” “No matter how you slice it, the American taxpayer has gotten precious little for the administration’s investment in battery-powered vehicles, in terms of permanent jobs or lower carbon dioxide emissions.” (Editorial, “GM’s Vaunted Volt Is On The Road To Nowhere Fast,” The Washington Post, 9/12/12)