An EB-5 immigrant investor project that received substantial attention last year is once again making headlines.
GreenTech Automotive, a new U.S. automotive company headquartered in McLean, Virginia, will begin churning out cars at one of its Mississippi manufacturing facilities before the end of the year. That's according to a recent Washington Post Q&A with one of the company's leaders, former Democratic National Committee Chairman Terry McAuliffe.
GreenTech first made news in the fall of 2009 when its CEO, Charles Wang, held a groundbreaking ceremony in which no ground was really broken. The new company announced it would construct a manufacturing facility at a site near Tunica, Mississippi, but nothing was ever built.
Substantial funding for the Tunica plant was supposed to come from the EB-5 visa program, although it's not clear how much. Gulf Coast Funds Management Regional Center is handling the immigrant investor financing element of the project.
Ever since McAuliffe got involved, a development first noted by the Mississippi Business Journal in April of 2010, there has been speculation that he's doing it for publicity. After an unsuccessful run for Virginia's gubernatorial nomination in 2009, the Mississippi Business Journal and others have postulated that McAuliffe is engaged in an effort to show he can bring jobs to America ? a potential gold star on his record in a future run for Governor.
But McAuliffe isn't tapping his extensive network of political donors to fund the GreenTech facility. A profile of the project by Bloomberg last October stated that McAuliffe already "had raised" money through the EB-5 visa program to fund construction.
The same article also considered some criticisms of the project, including this one from Erich Merkle, president of the research firm Autoconomy: "If I were investing my money, I think I could find a better place for it," he said. The MyCar "is certainly more of a high-risk venture."
In addtion, the Bloomberg piece included the following commentary:
Where McAuliffe sees the national interest, skeptics see political ambition. Local officials wonder if a fighter like McAuliffe can ever really leave the ring, or if he?s simply preparing for the next round. 'The biggest criticism people had when he ran in the primary was that a lot of political people didn?t even know he lived here because he didn?t get involved locally,' says Mame Reiley, who managed the campaign of Brian Moran, a primary opponent.
Politically motivated or not, McAuliffe has an excellent track record of raising money ? a trait that has likely made him a great asset to Gulf Coast Funds Management.
Not to be confused with the HK Motors project being handled by America's Center for Foreign Investment, GreenTech plans to sell the MyCar, a vehicle it calls a "fun, huggable, two-seater" and that only travels up to about 45 miles per hour.
The MyCar is not really a car like most people know it, but a "neighborhood electric vehicle" or NEV. You plug it in at night.
And you would never drive it on the highway.
In light of the Tunica plant being far from operational, GreenTech has stated that it will begin production of the MyCar this year at a former Dover Elevator facility in Horn Lake, Mississippi. As stated in McAuliffe's Washington Post Q&A, that plant is already "in operation," although it doesn't appear that any of its cars have hit the market just yet.
But the U.S. wouldn't be the only country benefiting from GreenTech's production facilities. McAuliffe and Wang just broke ground on a new plant in Ordos, Inner Mongolia, China that would produce MyCars for the Chinese market. According to a company press release, the Ordos facility would produce 300,000 vehicles per year at full capacity.
All of the parts would be manufactured at GreenTech's U.S. facilities.
Unfortunately, how many jobs GreenTech's efforts will actually create is somewhat of a mystery. In last year's Bloomberg report, the company apparently stated it would create 5,000 new American jobs. Its most current press release says 2,000.
The former DNC Chairman's recent comments to the Washington Post, however, are probably more realistic than either of those figures. McAuliffe told the paper that Mississippi will gain 350 new jobs from the GreenTech manufacturing facilities.
As for the MyCar, whether it actually catches on with the public is another question. Electric and hybrid vehicles typically have a higher up-front cost than most cars, and many (if not most) American drivers need to travel faster than 45 miles per hour just to get to work each day.
Always the politician, McAuliffe remains confident. As he explained to Bloomberg thirteen months ago, "No one can afford not to buy it."