GRAND RAPIDS, Mich. (WOOD) — A Michigan state panel says it considers a proposal to build an electric vehicle battery plant near Big Rapids “abandoned,” so it is clawing back some $175 million in incentives for the project.
In a letter to Gotion Inc., a company that manufactures batteries and provides “energy solutions,” the Michigan Strategic Fund of the Michigan Economic Development Corporation (MEDC) said it was suspending a $125 million Critical Industry Program grant. The MEDC said the company never hit the milestones for that money, so it was never paid out.
The MEDC also told Gotion to pay back about $23.7 million it used to buy property and said it was pulling about $26.3 million for site preparation that’s currently being held by economic development agency The Right Place, Inc.
The news was first reported by Crain’s Grand Rapids Business. An MEDC official told Crain’s that without the grant dollars, she didn’t see how the plant could be built.
“While this is not the outcome we hoped for, we recognize the tremendous responsibility we have to the people we serve to make sure their hard-earned tax dollars are spent wisely and appropriately,” the MEDC said in a statement released to Nexstar’s WOOD on Thursday. “We continue to focus on securing advanced manufacturing investments, especially across ICE, EV and hybrid vehicles to position Michigan at the forefront of the mobility revolution as it evolves and adapts to market conditions within this decade and beyond. We will continue doing all we can to bring good paying jobs and economic opportunity to Michiganders everywhere.”
Introduced in October 2022, the proposed plant carried a price tag of about $2.4 billion and promised to create about 2,350 jobs.
But many residents and Republican lawmakers pushed back over Gotion’s ties to China — Gotion Inc. is a subsidiary of China-based Gotion High-tech Co. Ltd. — as well as environmental concerns. Gotion Inc. said the project had nothing to do with the Chinese Communist Party and argued the plant would create high-paying jobs and spur economic growth.
Green Township initially approved the project in 2023, but voters then recalled and replaced several members, who voted to end support. Gotion sued in response. A judge initially sided with Gotion, but the decision was appealed. In January, Mecosta County commissioners also pulled their support of the project.
In March, Gotion told the Big Rapids Pioneer that it was putting the project on hold amid the legal battle.
In a Sept. 17 letter to Gotion Global Vice President Chuck Thelen, MEDC Michigan Strategic Fund fund manager Matthew Casby said because there has not been any work on the project for 120 days, it is considered “abandoned.” Citing that delay and the legal fight, the MEDC’s letter said Gotion “is in default of its obligations” as laid out in the Critical Industry Program grant agreement, and the grant is therefore suspended.
