A123 to Supply Batteries for Fisker Auto
WATERTOWN, Mass. (
) --
A123 Systems
(AONE)
, a maker of advanced lithium ion batteries, saw its shares rise Thursday after it agreed to supply batteries for electric cars built by
Fisker Automotive
and to invest up to $23 million in the start-up automaker.
Under the agreement, A123 will supply battery systems for Fisker's Karma plug-in hybrid electric vehicle that is scheduled for launch later this year.
The Karma will 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, the company said.
The Karma will be available for about $87,900 while a more affordable sedan version will cost about $48,000, according to the
Wall Street Journal
.
The partnership between the two companies reflects the efforts of the U.S. government to encourage the development of electric vehicles, the
Journal
reports. A123 received $249 million in grant money from the U.S. while Fisker received $529 million in a federal loan program to build plug-in hybrid cars.
"The federal money has been a catalyst," said David Vieau, president and CEO of A123.
A123 said it plans to expand its battery-assembly plant in Livonia, Mich., to raise capacity enough to produce 320,000 hybrid-vehicle battery systems and more than 24,000 plug-in hybrid systems a year.
A123's $23 million investment in Fisker is made up of $13 million in cash and $10 million in common stock.
Shares of A123 closed Thursday at $20.40, up 35 cents, or 1.75%.
