Autoblog

Bankrupt A123 changes name to B456 PDQ

Jonathon Ramsey — Fri, 29 Mar 2013 16:30:00 EST

Filed under: Government/Legal, Earnings/Financials

Ok, so we made the "PDQ" part up, but battery maker A123 Systems, Inc. has changed its name to B456 Systems, Inc. - and no, this is not an early April Fool's Day joke. As part of A123's bankruptcy proceedings dating to last October, it was required to change its name in order to be purchased by Chinese company Wanxiang. According to the Detroit Free Press, as part of a March 22, 2013 filing with the US Securities and Exchange Commission, A123 declared that ~~its new name is B456~~ the name of the old assets to be liquidated is B456, akin to the way the post-bankruptcy General Motors was broken into GM and Motors Liquidation Company. The ongoing concern owned by Wanxiang is still called A123 Systems, Inc. We're not sure if anyone at A123 realized the irony - B456 is also the model number for a fire extinguisher made by Amerex that happens to be good for "energized electrical equipment."

Wanxiang completed its purchase of ~~A123~~ B456 earlier this year. The company formerly known as A123 had received hundreds of millions of dollars in loans, tax credits and grants from the federal government and the states of Michigan and Massachusetts. Part of the funds from the Wanxiang purchase repaid the $2.8 million it received from Massachusetts, but it looks like the other monies will go unrepaid. The Chinese company has said it will keep the Michigan plants open, but Michigan is trying to keep Wanxiang from collecting the rest of its unused incentives.

Bankrupt A123 changes name to B456 PDQ originally appeared on Autoblog on Fri, 29 Mar 2013 16:30:00 EST. Please see our terms for use of feeds.

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Can the Chinese rescue Fisker?

David Kiley — Mon, 14 Jan 2013 16:00:00 EST

Filed under: Hybrid, Sedan, Earnings/Financials, Fisker, Electric, Luxury

Fisker Automotive is aggressively courting Chinese automakers to bail it out of its financial problems.

Executives with knowledge of the discussions told Autoblog that Fisker representatives have made recent trips to China to discuss deals that include capital investment and outright acquisition scenarios. Those discussions are continuing this week at the Detroit Auto Show. Reuters first reported discussions between Fisker and Chinese companies.

While Fisker was once favored by many auto industry analysts and executives to get the better of rival Tesla Motors in the premium/luxury EV market, Fisker has had several setbacks to its operations. The launch of the Fisker Karma, the company's first model, has been beset with problems, as is often the case with a new car company. Its lithium-ion battery supplier, A123 Systems, went bankrupt. And the company lost hundreds of cars at its Newark port when Hurricane Sandy devastated the New Jersey-New York coastline last fall.

In addition to needing investors, Fisker is also seeking strategic partners. Tesla, which had a successful initial public offering, for example, has both Toyota and Mercedes-Benz as investors and strategic partners.

Continue reading Can the Chinese rescue Fisker?

Can the Chinese rescue Fisker? originally appeared on Autoblog on Mon, 14 Jan 2013 16:00:00 EST. Please see our terms for use of feeds.

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China's Wanxiang looking to diffuse political fears over A123 purchase

Zach Bowman — Mon, 24 Dec 2012 09:01:00 EST

Filed under: China, Government/Legal, Earnings/Financials

Wanxiang Group has insisted A123 Systems will remain an American company operationally following intense scrutiny from US lawmakers. China's largest parts manufacturer purchased A123 Systems at auction after the company fell into insolvency, but the battery maker holds a number of defense contracts with the US government. Pin Ni, head of Wanxiang's US operations, told Reuters that A123 will not be folded into the group's lithium-ion battery unit and will instead remain an American company. The $257 million Wanxiang bid excludes the A123 defense contracts.

David Vieau, A123 CEO, said many of the concerns are overblown since his company has been manufacturing batteries in China for the past six years. The company has also worked to develop battery technology with SAIC Motor Corporation, a Chinese-state owned entity. Even so, insiders close to the deal say the battery maker hasn't shared some of its more important advancements with its partners, including tech that helps increase a battery's power density.

Meanwhile, Johnson Controls, the company that lost the bid to acquire A123 Systems by $6 million, has said it continues to be interested in the bankrupt company should the US government not approve Wanxiang's purchase.

China's Wanxiang looking to diffuse political fears over A123 purchase originally appeared on Autoblog on Mon, 24 Dec 2012 09:01:00 EST. Please see our terms for use of feeds.

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A123 winning bid from China's Wanxiang prompts concern in Congress

Zach Bowman — Mon, 10 Dec 2012 10:00:00 EST

Filed under: Government/Legal, Technology

The Detroit News reports that China's Wanxiang Group Corporation will acquire almost all of bankrupt A123 Systems Inc. for $256 million. The deal includes all of the American battery manufacturer's grid and commercial business assets as well as the company's facilities in Michigan, Massachusetts and Missouri. Meanwhile, Woodridge, Illinois-based Navitas Systems will purchase all of A123 Systems' government contracts for $2.25 million.

Previously, Johnson Controls was a leading bidder for the bankrupt EV battery manufacturer, but that company withdrew its bids from the bankruptcy auction after declining to match Wanxiang's highest bid. But the final sale will be subject to approval by the bankruptcy court handling the case in Delaware, and some members of Congress have reportedly raised concerns over the sale.

Rep. Bill Huizenga, R-Michigan, said he was concerned about Wanxiang taking over A123 Systems because of the battery maker's close ties with the US Defense Department. Huizenga has been quoted as saying, "I am concerned about the government of China having access to sensitive technologies being used by our military forces."

This isn't the first time we've heard those rumblings. Back in August, several US automotive executives said Wanxiang's purchase of A123 Systems could put industry trade secrets at risk, including cutting-edge lithium-ion battery technology. Likewise, November saw US senators John Thune, R-South Dakota, and Chuck Grassley, R-Iowa, raise concerns over the Chinese company's interest in the bankrupt battery maker.

A123 winning bid from China's Wanxiang prompts concern in Congress originally appeared on Autoblog on Mon, 10 Dec 2012 10:00:00 EST. Please see our terms for use of feeds.

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Fisker seeks financial partner after "tough year"

Seyth Miersma — Fri, 30 Nov 2012 18:30:00 EST

Filed under: Earnings/Financials, Fisker

After facing what could be charitably described as a terrible year, Fisker founder and Chairman Henrik Fisker admitted in a recent interview that his company is "actively engaged in conversations with potential strategic partners." Speaking with TheDetroitBureau.com, Fisker went on to say that he'd, "like to see if we can get something done next year."

As of this writing, Fisker has declined invitations to divulge which companies those partnership conversations are happening with. If one cared to hazard a guess though, BMW and General Motors - both loosely associated with Fisker in past dealings - might be good front-runners.

The urge to seek a tie-up with a larger, more stable entity does not come out of the blue for the independent Fisker. The reputation of the company's Karma model has been rocked by battery fires and a scathing review from Consumer Reports earlier this year, and now its production schedule is being held hostage by a battery shortage because its supplier, A123 Systems, has gone bankrupt. More significantly still, the company's plans to launch a second, more affordable Atlantic model have been stymied due to the US Department of Energy putting the brakes on a promised low-interest loan to the automaker.

This isn't the first time that the Fisker founder has admitted that all is not completely rosy, certainly, but there does seem to be a more pragmatic tone this time around than in interviews past. Which large company would make for a "dream" mashup with Fisker? Give us your two cents, in Comments.

Fisker seeks financial partner after "tough year" originally appeared on Autoblog on Fri, 30 Nov 2012 18:30:00 EST. Please see our terms for use of feeds.

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Did A123 Systems get $1M federal check the same day it declared bankruptcy?

Zach Bowman — Mon, 19 Nov 2012 11:29:00 EST

Filed under: Government/Legal, Technology

Automotive News reports A123 Systems, an electric vehicle battery manufacturer, received a disbursement check from the federal government on the same day the company filed for bankruptcy. On Oct. 16, A123 received $946,830 as the latest portion of a clean energy grant from the US Department of Energy. That was the same day A123 Systems filed for Chapter 11 bankruptcy protection following a failed attempt to secure funding from Chinese parts supplier Wanxiang Group. Of the original grant, $115.8 million is still outstanding, and despite the company's monetary woes, A123 Systems says it may still need the grant to update or expand its manufacturing capacity.

Republican Senators John Thune and Chuck Grassley wasted no time blasting the disbursement check as careless spending. The two issued a statement saying, "The Department of Energy needs to answer for why it appears to put federal grants on auto-pilot to the detriment of US taxpayers. This can't stand."

The Department of Energy, meanwhile, responded by saying the grant program requires companies to submit invoices detailing their progress toward predetermined goals before any funds can be issued.

Did A123 Systems get $1M federal check the same day it declared bankruptcy? originally appeared on Autoblog on Mon, 19 Nov 2012 11:29:00 EST. Please see our terms for use of feeds.

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Bailout and gas prices hot buttons in Presidential debate

George Kennedy — Wed, 17 Oct 2012 10:44:00 EST

Filed under: Hybrid, Government/Legal, Hirings/Firings/Layoffs, Plants/Manufacturing, Electric

The pros and cons of the auto bailout and concerns about the rising price of gasoline have been a political football throughout this election season. So, it should come as no surprise that the auto industry was brought up more than a few times in last night's heated presidential debate.

Roughly a minute into the debate, the subject was raised by President Obama when asked a question about unemployment. The President's answer: "I want to build manufacturing jobs in this country again. Now when Gov. Romney said we should let Detroit go bankrupt, I said we're going to bet on American workers and the American auto industry and it's coming back."

Romney countered by pointing out that Obama followed the Governor's advice offered in his New York Times editorial "Let Detroit Go Bankrupt" from 2008. Romney stated that the President did, in fact, let Chrysler go bankrupt, and pointed out, "My plan was to have the company go through bankruptcy... and come out stronger." Obama retorted that Romney's view of taking the automakers into bankruptcy did not provide them with any way to stay open, and would have lost a million jobs in the process.

The candidates also spoke on energy and oil production, primarily in response to questions of recently spiking gas prices. The President pointed out that oil production on federal land is at its highest in 16 years and natural gas production is at its highest levels in decades. Romney responded by saying that overall oil production is down 14 percent as a result of cutting licenses for drilling. Additionally, Romney criticized Obama for blockage of the Keystone oil pipeline.

Surprisingly, yesterday's bankruptcy filing of A123 Systems was not brought up, though Republicans, including Romney, have criticized the Obama administration's investment in electric cars as well as grants and loans for battery makers. If Tuesday's Chapter 11 filing was not mentioned last night, it will most certainly come up in the days and weeks to come.

Bailout and gas prices hot buttons in Presidential debate originally appeared on Autoblog on Wed, 17 Oct 2012 10:44:00 EST. Please see our terms for use of feeds.

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Battery maker A123 systems defaults on loan, files for bankruptcy

George Kennedy — Tue, 16 Oct 2012 13:29:00 EST

Filed under: Hybrid, Government/Legal, Hirings/Firings/Layoffs, Technology, BMW, Earnings/Financials, Fisker, Electric

After a long and bumpy road, battery-producer A123 Systems has officially filed for bankruptcy. This news comes immediately after word that the Waltham, Massachusetts-based company may not have enough cash to fund operations, or even seek bankruptcy protection. This news has ramifications elsewhere in the industry, as A123 had contracts with Fisker Automotive as well as with BMW.

In a press release issued this morning, A123 announced that it will sell off all automotive assets to Johnson Controls. A123 will file Chapter 11, while Johnson Controls will provide $72.5 million in debtor-in-possession financing. The aim of the financing is to support A123 while it attempts to pursue alternative business operations.

To anyone following the battery maker closely, this news should not come as a shock. It was estimated that A123 lost about $67 million dealing with a battery recall for the Fisker Karma. In May of this year, the company posted a $125 million net loss. Shares for A123 have fallen 85 percent this year as the company has posted 14 straight quarterly losses.

With news of the bankruptcy, it wouldn't be surprising if A123 were be brought up in tonight's presidential debate. A123 received $249 million in federal grant money in 2009. The company also received $100,000 in 2006 under the Bush Administration, and additional tax exemptions and credits during Mitt Romney's time as a Massachusetts governor, so this issue has many sides.

For Fisker, the issue at hand is finding a new battery supplier. Johnson Controls has had previous hybrid ventures and continues to explore lithium-ion batteries. This could be an opportunity for the Milwaukee-based company to expand that part of its business, perhaps replacing A123 as Fisker's battery supplier.

Continue reading Battery maker A123 systems defaults on loan, files for bankruptcy

Battery maker A123 systems defaults on loan, files for bankruptcy originally appeared on Autoblog on Tue, 16 Oct 2012 13:29:00 EST. Please see our terms for use of feeds.

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Fisker loan spurs more questions from senators

Danny King — Wed, 27 Jun 2012 11:29:00 EST

Filed under: Hybrid, Government/Legal, Fisker, Electric

Um, about that $337 million.

Fisker Automotive and its pending federal government loan has spurred a letter from two U.S. senators to Energy Secretary Steven Chu questioning the appropriateness of the loan, The Detroit News reports.

In their letter to Chu, senators John Thune (R-South Dakota) and Chuck Grassley (R-Iowa) reportedly question the $529 million loan in part because of Qatar's ownership stake in the plug-in hybrid automaker. The senators also inquired about the loan earmarked for Fisker partner A123 Systems, the company whose batteries have been subject to a recall.

Fisker spokesman Roger Ormisher tells The Detroit News that the company is staying out of politics and focusing on creating U.S. jobs. California-based Fisker was granted the loan in 2010 but has drawn down just $193 million to date.

Energy Department spokesman Damien LaVera argues the loan was an appropriate part of the federal government's effort to help boost fleetwide fuel economy and said Fisker's delays are "common for start-ups," according to the report.

Last week, Fisker debuted its first national advertising campaign in a multi-page Wall Street Journal ad that included a statement from company founder Henrik Fisker proclaiming that the automaker has "set out to redefine and reshape how the world thinks about cars." Fisker also recently widened its European distribution network.

Upon securing the original loan grant, Fisker was slated to hire 2,000 people at a Delaware factory that was formerly run by General Motors. Production of the Fisker Atlantic shown above, which was originally scheduled to be produced at the Delaware plant, has been delayed until at least 2014.

Fisker loan spurs more questions from senators originally appeared on Autoblog on Wed, 27 Jun 2012 11:29:00 EST. Please see our terms for use of feeds.

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A123 Systems posts $125 million net loss

Zach Bowman — Mon, 14 May 2012 16:02:00 EST

Filed under: Technology, Earnings/Financials, Electric

The Detroit News reports lithium-ion battery manufacturer A123 Systems is set to post a net loss of $125 million on revenue of $10.9 million for the first quarter of 2012. Official results will be released later this week. The loss includes $51.6 million tied to replacing battery packs produced at the company's Livonia, Michigan facility. Some of those packs could have been manufactured with defective cells. The figure also includes $15.2 million to increase inventory reserves.

As you may recall, A123 Systems provides battery packs for companies like Fisker. The extended-range EV manufacturer recently reported issues with the supplier's products, but A123 says it has determined the cause of the defective cells and is working to make sure the failures don't reoccur.

The report also suggests A123 Systems will lower its revenue forecast for the year to $145 million to $175 million. The company originally projected it would generate between $230 million and $300 million.

A123 Systems posts $125 million net loss originally appeared on Autoblog on Mon, 14 May 2012 16:02:00 EST. Please see our terms for use of feeds.

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Fisker may change plans on Delaware production, details Karma troubles

Autoblog Staff — Sun, 08 Apr 2012 10:01:00 EST

Filed under: Plants/Manufacturing, Hatchback, Earnings/Financials, Fisker

Fisker Automotive may drop plans to use a Delaware factory to build its upcoming Atlantic sedan and is looking at "other options," Automotive News reports, citing an interview with company CEO Tom LaSorda. The company, in an online meeting with owners of the Fisker Karma extended-range plug-in sedan, spelled out some of the issues that have been plaguing the car.

Fisker will hold off on deciding on the Atlantic's production site until the end of summer, which will delay the model's debut. LaSorda maintains that Fisker will be able to produce the Atlantic with or without Department of Energy funding, according to Automotive News. Fisker's director of corporate communications, Russell Datz, tells AutoblogGreen that the company remains "committed to Delaware" but admits that if the rest of the company's DOE loan money does not come through, the plan to build the Atlantic in Delaware could change.

Follow the jump to continue reading...

Continue reading Fisker may change plans on Delaware production, details Karma troubles

Fisker may change plans on Delaware production, details Karma troubles originally appeared on Autoblog on Sun, 08 Apr 2012 10:01:00 EST. Please see our terms for use of feeds.

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A123 confirms Fisker Karma batteries could have cooling problem

Jonathon Ramsey — Sat, 24 Dec 2011 10:48:00 EST

Filed under: Hybrid, Sedan, Safety, Fisker, Luxury

Battery maker A123 has announced that batteries it supplied to Fisker Automotive for its Karma range-extended luxury sedan might have "misaligned" hose clamps for the cooling system, which could cause coolant to leak. Unabated, A123 admits the leak could cause an electrical short-circuit.

According to Bloomberg-BusinessWeek, the company has a fix for the issue, and luckily the issue was discovered when there are no more than 50 Karmas needing the repair. A123 provides batteries to several other OEMs, but only Fisker's batch appears to suffer from the cooling issue.

A123 confirms Fisker Karma batteries could have cooling problem originally appeared on Autoblog on Sat, 24 Dec 2011 10:48:00 EST. Please see our terms for use of feeds.

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Ironic legislation: CARB ruling to kill aftermarket plug-in hybrids?

Jonathon Ramsey — Tue, 20 Jan 2009 19:58:00 EST

Filed under: Hybrid, Government/Legal, Green, I.C.E., Technology

The uncertain future of the alternative-powered and alternative-fueled vehicle is being decided by a confluence of old and new technology, big business and start-ups, marketing, vested interests, and public perception. It is no surprise, then, that when it comes to government regulation, we are bound to end up with some conflicting decisions. A company in California that converts regular hybrids to plug-in hybrids has found itself smack in the middle of one of those conflicts.

Last year, the California Air Resources Board (CARB) cut its mandated amount of electric vehicle sales in California by 70%. Some thought that might leave an exploitable opening for plug-in hybrids to gain serious market share. A number of start-ups have been established that install additional batteries into cars like the Toyota Prius, rendering them all electric below 34 mph, and allowing them to be recharged in 4 hours from a standard 3-prong outlet. The retrofit turns the 40+ mpg Prius into a 100+ mpg dromedary.

A new CARB proposal would require those start-ups to put their cars through smog tests that run about $25,000 per car, and to warranty their conversions for 10 years or 150,000 miles. The smog test issue has to do with a pollutant buildup issue in the catalytic converter and the gas vapor canister on cars that do a lot of cold starts and that might not use their internal combustion engines for more than three days. The warranty terms are the same as those mandated for any company that sells hybrids in California.

The start-ups say the pollutant issue has already been tested and solved by battery provider A123 systems, and it was approved in Massachusetts, a state that follows the same emissions standards as California. As for the warranty, the start-ups say they aren't altering the Prius, they are adding aftermarket batteries, so it doesn't make sense to force them to match the Prius' warranty. Besides that, the batteries they install are not expected to last ten years, so the warranty would be pointless anyway. The new regulations are expected to come into force next week anyway. Hat tip to reader Daniel

[Source: East Bay Express]

Ironic legislation: CARB ruling to kill aftermarket plug-in hybrids? originally appeared on Autoblog on Tue, 20 Jan 2009 19:58:00 EST. Please see our terms for use of feeds.

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General Motors accelerates battery development with A123 Systems

Sam Abuelsamid — Thu, 09 Aug 2007 15:03:00 EST

Filed under: Green, GM

Bob Lutz and A123 CEO Dave Vieau

This morning at the Management Briefing Seminars in Traverse City, MI, General Motors Vice-Chairman Bob Lutz announced that they were promoting battery supplier A123 Systems from Tier 2 to Tier 1 supplier status. That means that A123 will effectively no longer just be a sub-contractor to other companies that do battery pack integration.

GM will now work directly with A123 systems on the development of their nano-phosphate lithium-ion battery chemistry for use in motor vehicles. A123 will still work with companies like Cobasys and Continental on pack integration for applications like the plug-in Saturn Vue hybrid and the Chevy Volt, which Lutz said he expects to be ready for sale by 2010. Check out the live blog post at AutoblogGreen as well as the announcement.

General Motors accelerates battery development with A123 Systems originally appeared on Autoblog on Thu, 09 Aug 2007 15:03:00 EST. Please see our terms for use of feeds.

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