China-based Gotion High-Tech is doing its best to appear as an “American subsidiary” as it attempts to open a massive battery plant near Big Rapids with $715 million in taxpayer money.
Bridge reported about a recent legislative hearing:
“I’m having a hard time finding answers here about Gotion,” (Republican state Sen. John) Damoose said.
In reply to Damoose’s question, Chuck Thelen, Gotion Inc.’s vice president of North America Manufacturing who joined the meeting via video conference, sought to distinguish Gotion Inc. from Gotion High-Tech, the parent company.
Gotion Inc., he said, is incorporated in the U.S. as a wholly owned subsidiary of Gotion High-Tech, which holds about 3.5 percent of China’s EV battery market share and is publicly traded in both Switzerland and China. Volkswagen is a majority shareholder, though the German automaker does not have a majority voting right on the Board of Directors; those were retained by the founding shareholders.
However, earlier in his presentation, Thelen did not distinguish between the Gotion division planning to build in Big Rapids and Gotion High-Tech as he spoke about the parent company’s expansion around the globe.
In the early announcements about state subsidies for the Chinese company, Gotion High-Tech was referenced, not Gotion, Inc.
An October 5, 2022 press release by Gov. Gretchen Whitmer (D) simply referred to “Gotion,” but then said, “Founded in 1998 and based in Hefei, China, Gotion High-tech Co. engages in the research and development, production, and sale of power lithium batteries in China and internationally.”
In October 2022, Bloomberg reported:
Chinese battery maker Gotion High-Tech Co. was awarded $175 million in grants and a zoning designation estimated to be valued at $540 million, according to the Michigan Economic Development Corp.
And Reuters wrote it this way:
Chinese battery company Gotion High Tech and Michigan-based startup Our Next Energy (ONE) will open separate, new electric-vehicle battery plants worth a combined $4 billion in Michigan, Governor Gretchen Whitmer announced on Wednesday.
Reuters added, “Gotion, a publicly traded company in China also known as Guoxuan High Tech Company, is partly owned by German automaker Volkswagen AG.”
And then there is a presentation given to the Senate Appropriations Committee March 22, as the company is lobbying for the money to officially be allocated.
The slide show for legislators is copyrighted by Gotion High-Tech:
The entity quarterbacking site selection and collaboration with governmental entities and utilities is identified as Gotion High-tech.
The presentation also referred to Gotion’s CEO as Zhen Li:
Zhen Li is founder of Gotion High-Tech. Chen Li, his son, is CEO of Gotion, Inc., according to a World Economic Forum profile, further confusing who exactly is in charge of the American project.
This is all relevant because it ultimately determines who is in charge and what laws and rules the American operation would be following.
Chapter VI of Gotion High-Tech’s Articles of Association (page 47) establishes a “Party Committee,” whose sole purpose is to ensure the company is adhering to Communist Party doctrine and furthering its objectives.
“The Party Committee of the Company shall perform its duties in accordance with the Constitution of the Communist Party of China and other Party regulations,” including, “Ensure and supervise the implementation of the Party’s guidelines, principles and policies in the Company, and implement major strategic decisions of the CPC (Communist Party of China) Central Committee and the State Council as well as relevant important work arrangements of the Party organization at the higher level”.
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The Gotion corporate document also states that the company’s Party Committee shall “Strengthen the construction of Party organization and Party members at the grass-roots level of the Company” and oversee growing the “Communist Youth League and other mass work of the Company”.