Obama caves to China – GM EV (VOLT) Technology, Jobs, going to China
Seems Obama agreed to let GM move electric car development to China. The “jobs” President found the idea of going to the WTO over the Chinese applying a Chinese law that demanded the transfer of intellectual property, of technology, of jobs, to China in return for the use of Chinese labor in the manufacturing of whatever used that technology something he did not want to do. Indeed the Chinese law does not even apply to cars imported from the US that are not made in China, but China is ignoring their own law and treating the imported Volt as under the rules for a made in China Volt. China has a $19,000 subsidy for the buyer for each electric car sale and was refusing to apply that subsidy to electric car sales when the car was not made in China – a Trade Treaty and WTO violation. http://content.usatoday.com/communities/driveon/post/2011/09/gm-cuts-china-electric-car-deal—-a-china-shakedown/1
So the US and the Auto Workers, to the extent they are allowed to vote their ownership interests in GM, seem to have agree that GM would have sold few imported Volts given Chinese tariffs and the refusal to allow the $19,000 electric car subsidy to be used by buyers buying the Volt. General Motors agreed to “partner” with the Chinese firm SAIC, a past partner for cars made and sold in China, effectively moving GM’s future electric vehicle development to China – and how far behind will be the importing of Volts to the US and other countries we now might export too, and the loss of those American jobs?
So the electric vehicle development in the U.S., paid for in large part by your taxes, now goes to China. I liked the GM position that China has not explicitly demanded access to the volt technology, but the EV cars built in China would “draw upon” GM’s Volt experience and technology in the “all new” EV to be developed by SAIC and GM – with GM’s Girsky saying about building the Volt in China how “If we localize, eventually it won’t have a tariff and it will get the subsidy,” as GM promises to work with the Chinese to develop a next-generation, fully electric car. But then GM is now structured so that much of its profit comes China and its mini-car production with partner SAIC-GM-Wuling.
Just what is the ownership percentage of GM that is controlled by the US and the welfare and pension funds? Got to love a JOBS President afraid of going to the WTO with a complaint about China.
So I expect JOBS decisions like the above will hasten the time when the Unemployment change program is changed to one that ends in 26 weeks and which implements a form of the “Georgia Works” UE structure (where on a voluntary basis jobless individuals can chose to collect unemployment benefits via training employer – the UE money going to the employer and the unemployed put in a 24 hour per week for 8 weeks job training program, with a stipend to help cover childcare and transportation expenses while you train, so that on the job training is paid for by the state, should the company ever want to actually hire the individual), Indeed New Hampshire has adopted the Georgia Works template, but I suspect their will be a push for the voluntary aspect of the Georgia/New Hampshire program to be replaced with a mandatory program that says no benefits unless those laid off accountants and lawyers retrain as Walmart Greeters.