US to Subsidize Chinese Car Maker in California

Photo Credit: APA Chinese car maker is setting up shop in the U.S., with small ambitions but a clear goal: Get the federal government to subsidize the sales of the company’s American-made electric buses.

BYD Co., 002594.SZ +3.06% an electric-car and battery maker that counts Warren Buffett among its investors, will open an electric-bus assembly facility in Lancaster, Calif., on Wednesday.

The company’s U.S. expansion won’t create many jobs yet. The new plant will employ a few dozen people at the outset, according to Stella Li, BYD senior vice president. “We are starting small,” she said.

But the benefits of BYD’s move will be immediate, allowing it to sell its buses to local transit companies at a huge discount—with the federal government picking up the rest of the tab.

BYD spokesman Micheal Austin said the company’s U.S. production facility meets “Buy America” procurement guidelines, enabling its customers to tap federal subsidies that cover up to 80% of the cost of the electric buses they buy. The availability of government aid was one of the main motivations behind BYD’s move to the U.S., he said.

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