US cancels talks on $200 mln for Microvast battery company -source (updated)

Microvast Holdings

22/05/2023 23:30

(Adds Department of Energy comment in paragraph 5, attempt to
reach Microvast in paragraph 6)
    By Timothy Gardner
       WASHINGTON, May 22 (Reuters) - The U.S. Energy
Department decided on Monday to cancel contract  negotiations on
a $200 million award for Microvast Holdings  MVST.O , a lithium
battery company, a source familiar with the matter said.
    The department had been in talks with Microvast over a grant
 of $200 million from the $1 trillion 2021 bipartisan
infrastructure law for developing domestic manufacturing bases
and supply chains. 
    Last December, two Republican lawmakers criticized the
decision to grant the funding in a letter to Energy Secretary
Jennifer Granholm saying Microvast had ties to the Chinese
government.
    The source declined to say whether the decision to cancel
the negotiations had anything to do with concerns about China
ties. Contract decisions are made on factors including a
company's past performance, financial management and accounting
systems, the source said.  
    The Department of Energy has "a rigorous review process
prior to the release of any awarded funds, and it is not
uncommon for entities selected to participate in award
negotiations ... to not ultimately receive an award," a
spokesperson said. 
    Microvast did not immediately respond to a request for
comment.
    The grant had been set to support work by General Motors
 GM.N  and Microvast on developing specialized EV battery
separator technology and building a new separator plant in the
United States, work that had been expected to create hundreds of
new jobs. 
    Senator John Barrasso, the top Republican on the Senate
energy committee, had written a separate letter to Granholm
saying that Microvast was "joined at the hip with China" and
that the award was antithetical to the intent of the
infrastructure law.
    
    
    

 (Reporting by Timothy Gardner;
Editing by Marguerita Choy,  Stephen Coates and Bill Berkrot)
 ((timothy.gardner@thomsonreuters.com; +1 202 380-8348 (Twitter
@timogard); Reuters Messaging:
timothy.gardner.thomsonreuters.com@reuters.net))