A123 electric car battery plants to be bought by Johnson Controls
In addition to the $125 million acquisition, Johnson Controls will provide A123 Systems with $72.5 million to continue its operations at those two battery facilities, Gordon-Bloomfield writes.
In addition to the $125 million acquisition, Johnson Controls will provide A123 Systems with $72.5 million to continue its operations at those two battery facilities, Gordon-Bloomfield writes.
Despite filing for bankruptcy protection yesterday, lithium-ion battery firm A123 Systems has said the factories where it makes electric car battery cells will be saved, thanks to a $125 million deal with聽automotive聽parts maker Johnson Controls.聽
Already a huge Tier One global automotive parts supplier, Johnson Controls sells around 120 million lead-acid starter batteries a year to the automotive industry, as well as everything from instrument panels and information displays to headliners and floor consoles.
The purchase of A123 Systems鈥� automotive business by Johnson Controls will not only give the auto-parts maker the chance to build and sell lithium-ion batteries to automakers, but hopes to safeguard two of A123 System鈥檚 battery facilities in the U.S.聽
Alongside the two U.S. factories--located in Livonia and Romulus, Michigan--the deal will also see Johnson Controls obtain A123鈥檚 cathode powder plant in China, as well as equity interest in a joint venture with Shanghai Automotive Industry Corp.
In addition to the $125 million acquisition, Johnson Controls will聽provide A123 Systems with $72.5 million聽to continue its operations at those two battery facilities, ensuring production of electric car batteries can continue.聽
Back in 2009, A123 Systems was awarded a聽$249 Million grant聽by the U.S. Government under the Recovery Act of 2009.
The money--which had to be matched dollar for dollar by private A123 investment--was granted to A123 Systems to help create jobs, support the economy, and bring large-scale automotive lithium ion battery pack manufacturing to the U.S. for the first time.
Up to the moment of its bankruptcy filing, A123 Systems had used just $123 million of the available grant money.聽
Just to be clear, unlike the low-interest loans made available to automakers like聽Ford, Nissan, General Motors and聽Tesla聽Motors under the Department of Energy鈥檚 Advanced Technology聽Vehicle聽Manufacturing Program, the money made available to A123 Systems was a grant, not a loan.聽
This means the $123 million used by the firm so far--plus $6 million granted to it by the Bush Administration--has, and never will, require repayment.
鈥淎123, which has been building batteries for electric聽vehicles聽as well as the nation鈥檚 power grid, quickly established itself as an innovative player in the market,鈥� wrote Dan Leistikow, Director of the Office of Public Affairs at the Department of Energy,聽in a formal response to the news.聽
鈥淭oday鈥檚 news means that A123鈥檚 manufacturing facilities and technology will continue to be a vital part of America鈥檚 advanced battery industry,鈥� he continued.
Perhaps most importantly, however, Johnson Controls鈥� acquisition of A123 Systems鈥� automotive arm means that A123鈥檚 clients--including聽Fisker聽Automotive, BMW, and General Motors--will be able to continue聽 planned production without delays.聽
This means GM鈥檚 all-electric car project, the all-electric聽Chevrolet Spark, will not be delayed.聽