What would it mean if a Chinese firm acquires yet another cutting-edge U.S. manufacturer?
Last September, the Obama Administration announced that it would investigate surging auto parts imports from China. As recent trade data shows, America's auto parts trade deficit with China increased by $1 billion in 2012. Strangely, the Administration has been quiet on the auto parts issue in recent months, which leads one to wonder if the September announcement was simply campaign rhetoric…
As Chinese auto parts imports continue to surge, it concerning to learn that a struggling, start-up U.S. automaker, Fisker Automotive Inc., may be sold to a Chinese entity.
As David Shepardson reports in today's Detroit News, "two Chinese firms, Geely Automotive and Dongfeng Motor Corp., are in the running to acquire a majority stake in Fisker. Some reports have suggested Fisker could move all auto production to China as part of a deal."
Shepardson says that two U.S. Senators, Chuck Grassley (R-IA) and John Thune (R-SD), have raised concerns about the possibility of Fisker (a government-backed firm) being taken over by a Chinese company. Recently, the assets of electric car battery manufacturer A123 Systems were acquired by a Chinese company, a disappointing setback to the Obama Administration, which had awarded the cutting edge manufacturer nearly $250 million in grants.
The loss of Fisker cold prove similarly troublesome. Sen. Grassley expressed his concerns:
"Senator Thune and I asked the Energy Department about potential foreign ownership of Fisker in June 2012. When we raised concerns about taxpayers supporting a company with foreign ownership, the Energy Department waved those concerns away," Grassley said. "Now, those concerns may soon become a reality. Like A123, this looks like another example of taxpayer dollars going to a failed experiment. Technology developed with American taxpayer subsidies should not be sold off to China. I hope there's at least some accountability at the Department of Energy, but given its track record, I'm not holding my breath."
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