The US Energy Department cancelled the remaining half of the $249 million grant, after the company was purchased by Chinese Wanxiang Group.
The majority of the lithium ion batteries maker assets were purchased over the weekend by China’s Wanxiang Group. Once considered a successful investment by the Obama administration, ultimately the company had to file for bankruptcy due to weak demand for EVs and several technical missteps. The Obama administration offered A123 $249 million grant, part of a stimulus initiative of $2 billion to boost domestic battery manufacturing.
A123 received only $133 million in October, the same month it filed for bankruptcy. Although Wanxiang purchased the majority of the company’s assets, the government required taxpayer funded equipment and facilities to remain in the US and critics argued that such technology should not reach foreign hands.
“The review process at the Treasury Department is the last hope for ensuring some regard for U.S. interests,” U.S. Sen. Chuck Grassley, R-Iowa, said in a statement.