Fraught battery manufacturer A123 Systems has been handed salvation in the form of a US $465 million investment from Chinese car-parts maker Wanxiang Group Corporation.
This will result in Wanxiang, one of China’s biggest non-governmental companies, owning 80% of A123 and holding four of the nine board seats for A123.
Earlier this year A123 announced it was running out of money, despite a cash injection from the Obama administration in 2009. This new investment could mean a government funded business will be in the hands of a non-US company that could out-source jobs.
The Michigan based battery maker has suffered because the EV market has failed to take off as quickly as hoped, only accounting for 3% of US car sales last year. For the second quarter of 2012 it reported losses of US$ 82.9 million so is in desperate need of help. A123 has 2 500 workers whose job security rests on the secure future of the company.