Posting in Energy
With a class action lawsuit, recalls, and an end to govt. subsidies, A123 Systems could be the next DOE loan guarantee recipient to follow Solyndra into bankruptcy.
April has been showering misfortune on battery maker A123 Systems. It's financing another battery recall program, is a defendant is an investor class action lawsuit, and its stock is now dangling below US$1.
Why is this significant? A123 received a $249.1 million grant from the Department of Energy to build its battery concept. It's an election year, and Solyndra's failure is already a political bomb. There are plenty of videos on YouTube of Present Obama and Nancy Pelosi standing in front of A123 Systems' plants.
A123 spokesperson Steve Roy declined to comment on the pending litigation per company policy, but offered this statement on the company's overall financial health:
"We have sufficient liquidity to fund the field campaign to replace battery modules and packs with potentially defective cells. We do expect this situation will require us to adjust our fund-raising strategy, and plan to provide an updated outlook during our next quarterly earnings call. We have demonstrated our ability to strengthen our liquidity through strategic partnerships, so we believe we will be successful in fulfilling any necessary funding required to continue the growth of the company."
It would be able to withstand bankruptcy based on its reporting as of late December (Doomsday ration was .64 - the low end of average). Other financial indicators in Q4 weren't terrific: net profit margin was down 210.45%, its operating margin was down 204.34%, and EBITD for 2011 was down 141.09%.
You may recall last month's post about A123's role in a disastrous Consumer Reports review of Fisker Automotive's Karma plug-in hybrid sedan. The test car shut down (very publicly) before even making it through its initial round of testing, and an A123 battery was the culprit - prompting Fisker's second battery recall.
(Image Credit: everydayclimb.wordpress.com)
Related on SmartPlanet:
- Fisker recalls Karma over A123 battery defect
- Fisker preps project Ninja luxury sedan
- Fisker, EV Connect streamline car charging infrastructure
- Fisker Karma hydrid electric car coming in March
- Quantum to produce solar roof for Fisker Karma
- Fisker to replace electric car batteries - again
Apr 4, 2012
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You seem to have missed a few other bankruptcies. Not only Solyndra, but also Abound Solar, Energy Conversion Devices, BrightSource, LSP Energy, Evergreen Solar, Ener1, SunPower, Beacon Power, ECOtality, A123, Uni-Solar, Azure Dynamics, and Solar Trust. A truly amazing record.
...to think that these vanity-playthings for the 1%-ers financed by borrowing billions of dollars in my name (and built in Finland, stimulating their economy instead of mine) are showing up at their buyer's doors defective. Fortunately, their buyers, unlike the rest of us, don't have to rely upon them as their primary transportation. Another epic-fail for our "green" policy, and prime example of crony-capitalism at its worst.
Oh yea. Now I remember. - - A123 Systems ??? the taxpayer-funded electric vehicle battery manufacturer that famously shipped duds to Fisker Automotive, which caused one of its luxurious Karma EVs to shut down just before a Consumer Reports test ??? is now the defendant in an investor class action lawsuit and its stock has tanked to below $1. - - http://nlpc.org/category/keywords/a123-systems
I have not looked at A 123, but the last time I looked it up, all the rest of these companies were union shops. Non-union solar companies seem to be doing better as the market matures.