A proposed Chinese-owned EV battery component plant in Michigan facing public opposition eked out a key legislative win on Thursday when the state's Senate Appropriations Committee approved US$175 million in incentives by a 10-9 vote.

All six Republican members and three Democrats on the Senate Appropriations Committee voted against financing Gotion Inc's 700-acre project in Green Charter Township in rural Michigan. The vote was the final one needed to approve the transfer of state tax dollars, allowing officials to move forward. The Michigan House approved the funding last month.

Registered in California, the company is an American subsidiary of China-based Gotion High tech. For months, it has faced public and political backlash because of speculation over its alleged ties to the Chinese Communist Party.

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At the hearing, Chuck Thelen, Gotion Inc's vice-president for North American operations, announced that the company had received clearance from the Committee on Foreign Investment in the United States (CFIUS), an inter-agency federal panel that reviews transactions involving foreign investments for possible national security threats.

Michigan Republican state representative Angela Rigas (centre) joins protesters outside Ferris State University in Big Rapids, Michigan, on April 5. Photo: Angela Rigas alt=Michigan Republican state representative Angela Rigas (centre) joins protesters outside Ferris State University in Big Rapids, Michigan, on April 5. Photo: Angela Rigas>

"The committee determined that our proposed transaction was not subject to further review and we may proceed with the proposed transaction," Thelen said of CFIUS.

Before the vote, the senate panel also heard heated testimony from local elected officials, politicians and private citizens opposed to the plan.

"If you choose to give this money to Gotion, you are a traitor to this your republic, you are a traitor to your children's future," Kristina Karamo, chair of the Michigan Republican Party, said.

Marjorie Steele, who identified herself as a resident of Big Rapids, near Green Charter Township, said that people from townships and counties across the state were uniting and sharing their "resources, manpower, and grass roots activism" against Gotion.

A petition to recall Green Charter Township Supervisor Jim Chapman, who along with his board of trustees approved the project in December last year, was under way, Steele said. She warned that any lawmaker who voted in favour of China's Gotion would be considered "a black mole that needs to be expunged from our democratic republic".

Jerrilynn Strong, chairwoman of the board of commissioners in Mecosta County, where Green Charter Township is based, hailed the $2.3 billion project for the more than 2,000 jobs it would create. She said that only a "small but vocal" group of "professional picketers" were opposed to the plant.

On Wednesday, five Republican state senators wrote to Michigan's US congressional delegation to "use all federal resources available to immediately investigate" Gotion High-tech for "ties or contracts with foreign countries that have an adversarial relationship" with the US.

The proposed plant is in line to receive more than US$800 million in incentives and tax breaks, including the US$175 million the committee approved on Thursday.

State Senator Sarah Anthony, a Democrat who chairs the appropriations committee, said her support for Gotion was based on the "transformative impact" of its project, which promises to "double the per-capita income in one of the poorest counties in the state".

In a statement after the vote, US Representative John Moolenaar, a Republican who represents the district where the project would be built, called funding Gotion a "historic mistake".

US Representative John Moolenaar, a Republican who represents the district the Gotion plant would be built in, called the state's approval of US$175 million in incentives a "historic mistake". Photo: Bloomberg alt=US Representative John Moolenaar, a Republican who represents the district the Gotion plant would be built in, called the state's approval of US$175 million in incentives a "historic mistake". Photo: Bloomberg>

He noted that the 700-acre site is 100 miles from Camp Grayling where "Michigan National Guard have trained military partners from Taiwan to prepare for possible CCP aggression".

Moolenaar was among a bipartisan group of lawmakers who met with Taiwanese President Tsai Ing-wen in California along with US House Speaker Kevin McCarthy. Beijing considers Taiwan to be a renegade province, to be eventually united with the mainland, by force if necessary.

The charges against Gotion Inc reached new heights of oddness on Tuesday when state Senator Jonathan Lindsey, a Republican, said that the company could be helping the CCP extract lithium in Afghanistan and demanding an investigation into its links to the Taliban. Lithium is a key mineral used in making batteries for electric vehicles.

In response, Thelen told a local news outlet that "it was his understanding that there is a company spelled 'Gochin' that is actively engaged with the Taliban in Afghanistan about buying lithium".

This article originally appeared in the South China Morning Post (SCMP), the most authoritative voice reporting on China and Asia for more than a century. For more SCMP stories, please explore the SCMP app or visit the SCMP's Facebook and Twitter pages. Copyright © 2023 South China Morning Post Publishers Ltd. All rights reserved.

Copyright (c) 2023. South China Morning Post Publishers Ltd. All rights reserved.