Michigan Democratic governor Gretchen Whitmer is making a $236 million taxpayer-funded bet on an electric battery executive whose last company lost taxpayers tens of millions of dollars.
Whitmer on October 5 announced a $236 million incentive package for Our Next Energy, an electric vehicle battery startup that plans to build a factory in the Great Lakes State. Weeks later, the Democrat said she was "proud" to join the company's founder and CEO, Mujeeb Ijaz, at a ribbon-cutting ceremony, which saw Whitmer laud Our Next Energy as "innovative," "historic," and "cutting-edge." But Ijaz has a troubled history with public funding.
Before he launched Our Next Energy, Ijaz served as a top executive at fellow electric battery maker A123 Systems after founding its automotive division in 2008. One year later, A123 secured a $249 million grant from the Obama administration, with then-president Barack Obama predicting the company would "help power the American economy for years to come." Instead, the opposite occurred. A123 lost $269 million during an eight-month period in 2012 alone, losses that were driven in part by the company's production of defective battery cells for Fisker Automotive—on his LinkedIn, Ijaz specifically states he led A123's production of "battery systems" for Fisker. In October 2012, A123 declared bankruptcy and was quickly sold to Chinese automotive conglomerate Wanxiang.
Whitmer's decision to award Ijaz after A123's high-profile collapse comes as the Democrat faces a difficult reelection bid against Republican challenger Tudor Dixon. That race has seen Whitmer repeatedly claim she's added 25,000 "good-paying auto jobs" during her tenure, but as of May, Michigan had actually lost thousands of auto jobs on her watch. Whitmer likely hopes her green energy investments will help voters forget those losses—the Democrat used the announcement of her Our Next Energy incentive package, for example, to tout the creation of "2,000 new jobs." But the investments could also provide political fodder for Dixon, who has already criticized Whitmer for another grant recipient: Gotion, a Chinese battery manufacturer whose leader is a Chinese Communist Party member.
"This is something we have to hold Gretchen Whitmer accountable for," Dixon said in a September 27 video. "Your taxpayer dollars should be used to make sure your kids are getting a world-class education, you have reliable infrastructure, that you have safe cities. But now we're seeing taxpayer dollars go into an adversary, a Chinese corporation."
Whitmer's office did not return a request for comment.
At the time of its bankruptcy, A123 had already accepted $129 million in federal grant money. The company even received a $947,000 grant payment on the same day it filed for bankruptcy. In addition to the Obama administration grant, Michigan also gave A123 tens of millions of dollars in subsidies and tax breaks under former Democratic governor Jennifer Granholm, who now serves as President Joe Biden's energy secretary. Granholm in 2010 said A123 would help "create 63,000 jobs in Michigan over the next decade."
A123's bankruptcy hardly hurt Ijaz. Following the company's sale to Wanxiang, Ijaz in February 2013 became A123's chief technology officer, his LinkedIn states. The role reportedly saw Ijaz earn $294,000 per month.
Our Next Energy did not return a request for comment.
A123 was not the only taxpayer-funded green energy company to fail under Obama. The Democrat's administration in 2009 awarded solar panel company Solyndra a $535 million loan guarantee; the company declared bankruptcy and shut down all operations just months later. Obama in 2009 also approved a similar $529 million loan to Fisker, a move that then-vice president Biden said would lead to an "American manufacturing" resurgence. Instead, the company produced its vehicles in Finland and declared bankruptcy within years of receiving the loan.
Whitmer for months held a sizable polling lead over Dixon, but the race has tightened in recent weeks. An October Trafalgar Group poll showed the pair in a virtual tie, with Whitmer receiving 48.4 percent of the vote to Dixon's 47.9 percent.