A123’s troubles are latest short circuit for EVs
It has been a bad stretch for true believers in electrified vehicles. One by one, startups that basked in EV hype and hoopla are bumping into grim reality as they enter the marketplace.
Last week lithium ion battery maker A123 Systems filed for Chapter 11 reorganization and said Johnson Controls has agreed to acquire its auto battery business.
A123’s troubles stem in part from the failure of its batteries in a Fisker Karma plug-in hybrid.
The Karma’s A123 battery failed during an April test by Consumer Reports. Replacing the defective batteries is expected to cost A123 $66.8 million.
About a quarter of A123’s revenue last year came from Fisker. Next year A123 will provide the batteries for the Chevrolet Spark EV.
The company also supplies BMW and China’s SAIC Motor Corp. A123 said it plans to continue operations during its restructuring.
Meanwhile, Fisker said production of its second model won’t begin until late 2014 or 2015, at least two years later than initially planned.
Fisker said it will start building preproduction versions of the Atlantic midsized gasoline-electric sedan in 2014. The car had been scheduled for a former GM plant in Wilmington, Del. Those plans were put on hold after the Department of Energy froze Fisker’s credit line in February.