backtop


Print 18 comment(s) - last by maugrimtr.. on Dec 11 at 9:53 AM


  (Source: bloomberg.com)
Congress isn't too sure about the outcome

A123 Systems finally has a new owner after its auction this past weekend, but Congress isn't too happy about the outcome.

Chinese firm Wanxiang Group won the auction for A123 Systems on Saturday for about $260 million. This has concerned certain members of Congress, who said that A123's contracts with the U.S. Department of Defense are at stake.

"I am very concerned by Wanxiang's acquisition of A123," said Rep. Bill Huizenga (R-Zeeland). "A123 maintains several contracts with the Department of Defense and given the thin line between Wanxiang and the Chinese Government, I am concerned about the Government of China having access to sensitive technologies being used by our military forces."

However, Wanxiang doesn't have full access to A123's technology. Part of A123 was also sold to Illinois-based Navitas Systems LLC, which will hold the DOD contracts for $2.2 million.

Back in mid-October, A123 Systems officially filed for bankruptcy and agreed to sell its automotive business assets to Johnson Controls -- a company that optimizes energy efficiencies in car batteries, buildings and electronics.

Before that, A123 was missing its loan payments. It had received $249.1 million in grants from the U.S. government in 2009 to develop green, electric car batteries. It was discovered that the U.S. government gave A123 a $1 million grant the day it filed for bankruptcy.

A123 Systems suffered a huge kick earlier this year when it announced a $55 million battery replacement program for Fisker Automotive's Karma. The vehicle had issues with the batteries' hose clamps. 

A123 Systems joins a list of other green companies that filed for bankruptcy after receiving government loans and grants. Back in September 2011, solar panel company Solyndra filed for bankruptcy after receiving a $535 million loan from the U.S. Department of Energy (DOE). In November, Beacon Power (maker of flywheels for grid efficiency) filed after receiving a $43 million loan guarantee from DOE in 2010. 
 
In January 2012, EV battery maker Ener1 filed for bankruptcy after its subsidiary, EnerDel, won a $118.5 million grant from DOE in 2009. 

The U.S. Bankruptcy Court in Delaware will hold a hearing on the result of the A123 Systems auction on Tuesday, December 11.

Source: The Detroit News



Comments     Threshold


This article is over a month old, voting and posting comments is disabled

What Could Go Wrong?
By DaveLessnau on 12/10/2012 10:37:51 AM , Rating: 2
Gee. What could go wrong with this deal? China probably provides the Lithium used in the batteries. Now, they'll be providing the actual batteries, themselves. It's not like anything important runs on those batteries. Oh, wait. It's our upcoming transportation technology for the whole country. Oops. Make that the world. Nah. Nothing could go wrong with that.




RE: What Could Go Wrong?
By StanO360 on 12/10/2012 1:34:46 PM , Rating: 2
The EPA long ago forced battery companies into a corner. It's only in the last 4-5 years that it's been possible to build a battery plant economically. But in truth, that's only because of subsidies. We were a dominant player in the standby battery business, but until recently they were a "dirty" business that the government would just as well get rid of.

If you close a plant to retrofit . . . the EPA will destroy you. If you want to build a plant . . . the EPA will destroy you . . . unless you are a favored son (aka bundler).


RE: What Could Go Wrong?
By NotTarts on 12/11/2012 2:30:12 AM , Rating: 2
Why would anyone buy from A123 by this point? They went bankrupt because they couldn't compete and companies turned to Korean and Japanese sources. Nissan went with NEC, GM chose LG, Mitsubishi's cells are sourced from Toshiba, and Tesla works with Panasonic. A123 had a whole bunch of automotive contracts lined up but no one followed through apart from Fisker, who aimed to sell 15000 cars in 2012 but sold less than 2000.

Lithium is mainly produced in Chile and Argentina, and nickel is mined in Russia, Canada, and Australia. Very few, if any, raw materials in Li-ion batteries are sourced from China.

When it comes down to it, the main cause of concern are the loss of technologies that A123 developed.


“And I don't know why [Apple is] acting like it’s superior. I don't even get it. What are they trying to say?” -- Bill Gates on the Mac ads














botimage
Copyright 2014 DailyTech LLC. - RSS Feed | Advertise | About Us | Ethics | FAQ | Terms, Conditions & Privacy Information | Kristopher Kubicki