DOE grant recipient to spend $55M replacing potentially defective battery packs

A123 received a $249 million DOE grant in 2009


A123 Systems, an electric vehicle battery manufacturer and Department of Energy grant recipient under President Obama’s 2009 green jobs initiative, will spend an expected $55 million replacing potentially defective battery packs.

The Detroit Free-Press reports:

The announcement was the last setback for the battery manufacturer that reported earlier this month that it lost $85 million in the fourth quarter of 2011, largely because Fisker Automotive had ordered fewer battery packs than previously expected. Fisker is one of A123 Systems’ largest customers.

Earlier this month, Consumer Reports disclosed that a $108,000 Fisker Karma shut down at the magazine’s Connecticut testing center. The issue that triggered A123’s battery replacement campaign was a contributing factor in the Fisker vehicle’s malfunction, Vieau said.

[…] The company’s shares tumbled more than 11% to $1.50 but early this afternoon.

A123 Systems received a $249 million Energy Department grant, and Fisker received a $529 million loan guarantee from the agency.

The company has spent at least $730,000 lobbying Congress on federal issues pertaining to the batteries they produce. President and CEO David Vieau has contributed at least $14,900 to Democrat candidates and groups since 2007.