Capitol News

The Michigan Strategic Fund has officially ended its support for the Gotion Inc. electric vehicle battery parts factory project in Mecosta County, after determining that the company was in default of its obligations under a 2022 grant agreement. The move comes after years of local opposition and legal disputes involving Gotion High-Tech Co. Ltd., a China-based firm.

The Michigan Economic Development Corp. (MEDC) confirmed to Crain’s Detroit Business that it does not expect the project to continue, leading to the suspension of state subsidies and efforts to recover $23.7 million already spent by taxpayers.

Governor Gretchen Whitmer and other officials had previously promoted the project as a $2.4 billion investment that would create 2,350 high-tech jobs in Michigan. However, according to research and reporting from the Mackinac Center for Public Policy, there were longstanding doubts about whether these promises could be fulfilled.

James Hohman, director of fiscal policy at the Mackinac Center, commented on the situation: “The state expected the company would create 2,350 jobs with $175 million in subsidies. But Gotion will not create any jobs, and taxpayers may be out the $24 million they spent on site preparation for the company,” he said. “Business subsidies tend to disappoint. Only 9% of the jobs promised in major deals actually get created. Lawmakers would be better advised to improve the business climate for everyone rather than to write checks to select companies.”

The Mackinac Center and its news division Michigan Capitol Confidential have reported on developments related to this project over its three-year history. The cancellation is seen by some as a positive outcome for residents of Green Township and Michigan taxpayers.