A123 Systems idles 125 workers at 2 Michigan plants as battery orders drop
DETROIT -- Reduced orders for lithium ion batteries has prompted A123 Systems LLC to temporarily lay off about 125 employees at two Michigan plants this month.
Waltham, Mass.-based A123 fell victim to lower demand after Fisker Automotive ran into production delays for its Karma plug-in hybrid sports car, said Jason Forcier, vice president and general manager of automotive solutions at A123.
Fisker projected delivery of 7,000 cars this year, but faulty wire harnesses delayed production. Fisker reduced its deliveries to 1,500 vehicles for 2011, Chairman Ray Lane told Automotive News this month.
Fisker expects to deliver 15,000 cars in 2012, Lane said.
A123 is the sole supplier of lithium-ion batteries to Fisker.
Forcier said that the layoffs are temporary and that the workers should be hired back within four to six months.
"We're basically aligning our workforce with that reduction in orders from Fisker," he said. "We had to take some action to get our costs in line, but we believe it to be temporary, and we'll bring those people back as Fisker works through some inventory."
After the Fisker announcement this month, A123 reduced year-end revenue projections to $165 million to $180 million from $210 million to $225 million.
A123 still employs 600 at the two suburban Detroit plants and an engineering center in Ann Arbor, Mich.
The supplier is supporting 21 current or pending vehicle programs at its Michigan plants, including the BMW 5-series ActiveHybrid and the upcoming Chevrolet Spark Electric.
Editor's note: An earlier version of this story used an incorrect location for A123's headquarters. It is in Waltham, Mass.