A123 Systems LLC, a developer and manufacturer of advanced Nanophosphate® lithium iron phosphate batteries and systems, announced an agreement to divest of its grid storage business and other assets related to energy storage for telecom and IT data storage applications.
A123 is increasingly focused on the transportation market with a particular emphasis on micro-hybrids. This rapidly growing application segment is attractive because automotive OEMs around the world are steadily turning towards simpler forms of electrification in their mainstream high-volume vehicle lines to address the ever-increasing regulatory requirements of lower emissions and better fuel economy around the world. A123’s battery technology is very well suited to the requirements of this market and the company is currently producing 12-volt micro-hybrid batteries for numerous programs across three vehicle manufacturers.
A123 also continues to actively serve and grow its customer base in the fields of hybrid, plug-in hybrid and fully electric vehicles globally. With the recent integration of battery production and engineering facilities in Hangzhou, China, which were previously under the management of Wanxiang EV, A123 has expanded its battery technology portfolio to include additional products well suited to the requirements of electric cars and buses.
“Our move to sharpen focus on current and future customers in the global transportation market demonstrates strategic clarity in our business. Our customers and partners around the world will benefit from the organization focusing its R&D strength and system engineering capabilities on clear priorities” said Jason Forcier, CEO of A123 Systems. “We look forward to continued growth as a provider of leading-edge energy storage technology to the world’s vehicle manufacturers as they continue to develop the most economical forms of electrification.”
The divested businesses are being sold to NEC Corporation of Japan which intends to incorporate them into its Smart Energy Business Unit. The former A123 Energy Solutions facilities in Westborough, Massachusetts and Chesterfield, Missouri are included in the deal. As part of the transaction, A123 will retain all of its cell manufacturing locations globally including those in Michigan and China and become a key cell supplier to NEC.
In addition to the transportation business, A123 intends to expand its marketing and distribution of cell products for commercial and industrial applications. The company has formed a new commercial products business unit and will retain its relationships with existing distributors, integrators and value-added resellers of lithium-ion battery cells. A123 already enjoys considerable brand strength in this market and additional investments are planned.
The third pillar of A123’s future is its Venture Technologies unit. Last year, A123 Venture Technologies was introduced to offer a new model for cooperative development and commercialization of innovative battery technologies by drawing on the considerable R&D resources and experience of the company. A123 Venture Technologies has already become successful in establishing strategic relationships with battery start-ups who are in early phase development. The unit has also developed an impressive performance record in motorsports and other high performance applications.