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Gov. McMaster defends SC’s $1.3B deal with Scout Motors over conservative lawmaker backlash

Gov. Henry McMaster on Monday defended South Carolina’s $1.3 billion incentive deal with Volkswagen subsidiary Scout Motors after a group of conservative lawmakers this month criticized the company as “woke.”

“It’s an old company and this investment they’re making is going to last for decades,” McMaster told reporters at the State House after he signed the largest incentive package in state history and project development agreement for the $2 billion plant. “They’re looking for a home, and the thing to remember is that they will be hiring South Carolinians to do the work.”

McMaster on Monday formally signed the $1.3 billion Scout Motors incentive package to bring the Volkswagen-backed electric vehicle plant to Blythewood, 20 miles north of Columbia. Scout plans to invest $2 billion to build out the plant by 2026 and add 4,000 jobs.

McMaster called Volkswagen a great company, adding that matters most.

“They’re going to build an iconic vehicle, and the people of South Carolina of course are very firm in their values, and they’ll be the ones that are working in this plant,” McMaster said.

The deal has its detractors, some of whom voiced criticisms over the taxpayer incentives during a lengthy legislative debate last week.

On the House floor March 13, a group of conservative lawmakers who make up the House Freedom Caucus questioned the state’s $1.3 billion investment “gamble”, and accused the company of being socially “woke.”

“I believe in the free market. Go woke, go broke. But, unfortunately, we’re using taxpayer money to subsidize them coming in here,” said state Rep. R.J. May, a Lexington Republican and vice chairman of the conservative freedom caucus. “We shouldn’t be subsidizing the destruction of South Carolina values.”

A rendering of the would-be Scout electric vehicle plant to be built in a new Blythewood industrial park.
A rendering of the would-be Scout electric vehicle plant to be built in a new Blythewood industrial park.

The Scout incentive deal, publicly announced March 3, moved quickly through the General Assembly.

Details of the incentive package from the state were disclosed March 6, and state lawmakers started debate over the incentives the next day. A week later, both chambers approved the $1.3 billion package.

McMaster on Monday pushed back against criticism from some lawmakers who said the process was rushed and called the investment a risk. Scout and the state’s Department of Commerce started negotiating the deal about two months ago.

“They’ve got a history of excellence and precision, and it’s because of that they are growing,” McMaster said of Scout. “We were ready for this, and it was a process that explored many different avenues. No stone was left unturned, and we believe that this is a great partnership. It’s good to have this company building vehicles in South Carolina.”

The $1.3 billion deal between Volkswagen and South Carolina includes construction of a railway bridge over Interstate 77 to the Blythewood industrial park site. It also includes an I-77 interchange to serve the eventual factory, road improvements, electrical work and water and sewer infrastructure.

And it includes $25 million to build a training center at Midlands Technical College in Columbia and $16 million to buy property to connect to a Class I railroad.

South Carolina will also spend $400 million to help with construction costs, and Scout will get a $200 million loan to carry out soil stabilization on the site.

Volkswagen has promised to pay South Carolina up to $790 million if the German automaker doesn’t meet or maintain certain job and investment commitments, the commerce department said.

Scout CEO Scott Keogh, who attended the bill signing Monday, said at the press conference that he enjoyed the State House debate over the incentive deal.

“I don’t exactly know what that means to tell you the truth,” Keogh later told reporters in response to some lawmakers’ “woke” accusations. “What are we doing here? We’re investing in the future. We’re building a beautiful car. We believe in new technology, which is electrification. We believe in providing great jobs. So that’s what we’re doing here.”