plus 4, A123 Takes Stake in Fisker Automotive - Private Equity Hub

A123 Takes Stake in Fisker Automotive - Private Equity Hub
A123 Systems Inc. signs battery deal with Fisker Automotive Inc. - Crain's Detroit Business
Volkswagen to debut ad during Super Bowl - Detroit News
GM China exec says uncertain on Hummer deal - MoneyControl.com
A123 Systems (AONE) Jumps On Battery Deal with Fisker Automotive - StreetInsider.com

A123 Takes Stake in Fisker Automotive - Private Equity Hub

Posted: 14 Jan 2010 12:13 PM PST

DETROIT (Reuters) - Lithium-ion battery supplier A123 Systems (AONE.O) said on Thursday that it had signed a deal to supply power packs for the Fisker Karma, a rechargeable luxury car being launched later this year.

A123 also said it would invest $23 million in a funding round for Fisker Automotive, an ambitious venture capital-backed start-up behind the Karma and a lower-cost plug-in hybrid car to launch in 2012.

The announcement of the closely watched supply deal comes a day after EnerDel, an Indiana-based unit of Ener1 (HEV.O), said it had broken off talks with Fisker to be its battery supplier for the Karma.

Fisker was the recipient of a $528 million low-cost loan from the U.S. government to help fund its expansion plans, including a still-pending deal to buy an abandoned Delaware assembly plant from General Motors Co. [GM.UL]

As a condition of receiving that government loan, Fisker has been raising additional equity from investors.

The Los Angeles-area start-up counts Silicon Valley-based Kleiner Perkins Caufield & Byers as an investor and plans to deliver its first Karma models in September.

In a statement, Boston-based A123 said that making the investment in Fisker "would closely align the interests of both companies" and allow them to work together on future vehicles.

The Fisker Karma, which is designed to travel 50 miles on a single charge and accelerate to 60 miles per hour from a standing start in six seconds, will sell for $87,900.

The Karma will be built in Finland by Valmet Automotive and will carry a powerful battery pack designed to allow it to travel 50 miles on electric power alone.

Fisker founder and Chief Executive Henrik Fisker said on Wednesday that EnerDel had not been able to meet the automaker's production schedule for the Karma.

He said A123 had been selected "because of the company's ability to meet our performance needs and rapidly scale to our production volume."

A123, the recipient of a $249 million grant from the U.S. Department of Energy, is expanding a battery cell plant in Livonia, Michigan and building a coating facility in nearby Romulus.

The expansion will increase A123's production capacity by 18 percent and give it the annual ability to supply batteries for about 24,000 plug-in hybrids like the Karma.

(Reporting by Kevin Krolicki, editing by Dave Zimmerman)

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A123 Systems Inc. signs battery deal with Fisker Automotive Inc. - Crain's Detroit Business

Posted: 14 Jan 2010 11:08 AM PST

Watertown, Mass.-based A123 Systems Inc. (NASDAQ: AONE) signed an agreement today to supply lithium ion batteries, manufactured at its newly-leased Livonia facility, to Irvine, Calif.-based Fisker Automotive Inc.

The batteries will be used in Fisker's Karma plug-in hybrid electric vehicle which is scheduled to launch later this year.

Production is schedule to begin at the 291,000-square-foot Livonia plant at 39000 W. Seven Mile Road, in the second half of this year.

The plant will have an annual capacity of 320,000 batteries for hybrid vehicles and 24,000 batteries for plug-ins.

At a press conference held in Lansing today, A123 and Jennifer Granholm also announced the company would hire up to 540 skilled workers at the Livonia and Romulus facilities, through 2012.

As part of the agreement, A123 and Fisker will collaborate on Fisker's "Project Nina" platform with the intent of A123 supplying batteries for the vehicle — which is expected to launch in 2012, costing near $48,000, according to a statement by A123.

A123 has also agreed to invest up to $23 million in Fisker's current funding round, consisting of $13 million in cash and $10 million A123 common stock.

In August, A123 received a $249 million grant from the U.S. Department of Energy to fund its $600 million battery operations in Southeast Michigan.

The advanced battery company also leased a building at 38100 Ecorse Road in Romulus last year.

Fisker received $529 million low cost loans from the DOE in September 2009.

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Volkswagen to debut ad during Super Bowl - Detroit News

Posted: 14 Jan 2010 10:33 AM PST

Notebook

Detroit News staff and wire reports

Volkswagen to debut ad during Super Bowl

Volkswagen AG will roll out its new pitch to American customers early next month in a Super Bowl ad.

Volkswagen hired Interpublic Group's Deutsch in Los Angeles as its new ad agency. Deutsch's debut ad for VW will appear during the Super Bowl, said Stefan Jacoby, president of Volkswagen Group of America.

He said VW is trying to reach out to a broader customer base in the United States and will emphasize the message that: "Hey, there's a VW for me!"

VW is building a $1 billion plant in Chattanooga, Tenn., where it will assemble an all-new midsize sedan designed for the American market. The Chattanooga plant will go into production next year.

The Super Bowl will be played Feb. 7 at Dolphin Stadium in Miami.

Ross says U.S. needs manufacturing strategy

Detroit -- The U.S. needs a comprehensive manufacturing strategy and another auto sales boost that could be achieved by launching a more generous "cash for clunkers" program immediately, billionaire investor and supplier magnate Wilbur Ross said Wednesday.

Ross, who has bought a number of suppliers to create International Automotive Components, said he would implement a new trade-in incentive program immediately if he could. But his would be simpler with fewer time and other restrictions on the vehicles that can be traded in and would have to ensure dealers are paid promptly, he said at the Automotive News World Congress.

Consumers around the world are becoming extremely price-sensitive in all purchases, he said, creating an environment in which no one can back off incentives or risk losing sales to their competitors.

Overall, he said the United States needs a comprehensive manufacturing strategy that includes the auto industry.

Most development actions are occurring at the state and local level resulting in millions being spent to create high-paying auto jobs in Southern states at the expense of job loss in other states. "There is not a good overall strategy," he said.

"China has a sensible and well implemented development strategy," Ross said. "The U.S. does not."

Marchionne fits in speech around barbs from crowd

Sergio Marchionne was interrupted twice during a speech at the Automotive News World Congress Wednesday night by protesters denouncing moves by Chrysler Group LLC and Fiat SpA, the two companies where he is CEO.

First was an Italian-speaking protester yelling "Shame on you! Stop killing Italian jobs."

Marchionne was interrupted a second time by a woman who said her mother was killed by an allegedly defective Chrysler product.

The executive also said that within 20 years there would be six auto companies left: two each in North America, Europe and Asia. He declined to name any, other than to say Chrysler would be among the last ones standing.

Christine Tierney and Alisa Priddle contributed.

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GM China exec says uncertain on Hummer deal - MoneyControl.com

Posted: 13 Jan 2010 09:32 PM PST

The head of General Motors Co's China operations said on Wednesday that GM is still awaiting Beijing's approval for a deal to sell Hummer and that he is uncertain of the outcome.

The US automaker reached a tentative deal in June to sell the Hummer SUV brand to China's Tengzhong Heavy Industrial Machinery.

"We're involved in the government approval process," GM China Group President and Managing Director Kevin Wale said at the Automotive News Congress in Detroit.

Asked if he expected the Chinese government to allow the sale to close, Wale said: "Still to be decided. I don't know what the outcome is going to be."

"We're hopeful it will be decided in the very near future but we don't know"."

GM Chief Executive Ed Whitacre said last week the company aimed to close the sale by the end of January. GM had initially planned to close the deal at the end of 2009.

If the sale fails, it would mark the fourth sale that was not completed after earlier deals to sell Saturn, Saab and Opel units collapsed last year.

In September, Penske Automotive Group pulled out of an agreement to buy Saturn the day before it was expected to close. In November, GM's board reversed a decision to sell a 55% stake in Germany-based Opel to a group led by Magna International, opting to keep the European unit instead.

GM is also proceeding with the wind-down of Saab and has said none of the bidders for the money-losing brand had presented financially viable plans yet.

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A123 Systems (AONE) Jumps On Battery Deal with Fisker Automotive - StreetInsider.com

Posted: 14 Jan 2010 05:53 AM PST

January 14, 2010 8:59 AM EST

Shares of lithium ion battery maker A123 Systems (Nasdaq: AONE) is up 11 percent in pre-open action afteer the company announced a battery supply agreement with Fisker Automotive, a new American automaker building premium green vehicles.

The supply agreement is for battery systems for the Fisker Karma Plug-in Hybrid Electric Vehicle (PHEV), which is scheduled to be launched in late 2010.

A123 Systems will provide Fisker Automotive with advanced automotive battery systems that combine high power and energy density with excellent safety and life performance. Fisker Automotive and A123 will also collaborate on Fisker's Project Nina platform, with the intent of having A123 supply batteries for that vehicle based on meeting the automaker's performance and delivery requirements. Project Nina is expected to launch in 2012.

The Fisker Karma is expected to have a range of 50 full-electric miles on a charge of A123's lithium ion battery system and a total range of 300 miles with an on-board generator turned by a traditional but efficient four-cylinder gasoline engine.

In addition to entering into the supply agreement, A123 also announced its intent to invest up to $23 million in Fisker Automotive's current funding round in order to establish a strategic relationship with the car company.