Will A123 Batteries Survive?
Looks like another "green" company might not make it - but I actually like this one, and hope it does.
A123 is an innovative battery company which ramped up production capability too quickly. Because of that, a welding machine in their new factory was misaligned and, even though it was only one of four machines, cells from that machine could be in each battery and could fail, so all have to be recalled. This will cost $55 million. To a company A123's size, $55 million is a large amount—the company brought in only $139 million in funding all of last year.
A123 Systems had $187 million in cash at the end of 2011, considerably less than the $258 million it lost last year. A123 had planned to cut its cost and raise up revenues... and if they survive this they probably will be able to. But like so many before them, they completely misjudged the ramp up of electric vehicles.This is also related to the massive fail which is Fisker Automotive, which I have long predicted will be a flop.
A123 is an innovative battery company which ramped up production capability too quickly. Because of that, a welding machine in their new factory was misaligned and, even though it was only one of four machines, cells from that machine could be in each battery and could fail, so all have to be recalled. This will cost $55 million. To a company A123's size, $55 million is a large amount—the company brought in only $139 million in funding all of last year.
A123 Systems had $187 million in cash at the end of 2011, considerably less than the $258 million it lost last year. A123 had planned to cut its cost and raise up revenues... and if they survive this they probably will be able to. But like so many before them, they completely misjudged the ramp up of electric vehicles.This is also related to the massive fail which is Fisker Automotive, which I have long predicted will be a flop.
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