A123 Systems has named Jason Forcier as the new CEO. It has been less than one year since the company was acquired by Chinese auto supplier company Wanxiang Group. Forcier will be replacing former CEO David Vieau. Vieau was removed from the position after Wanxiang bought out the company.
Forcier was the vice president of the A123 automotive business division before the Wanxiang deal took place. Forcier will be on the board of directors at A123 Systems along with Pin Ni, the CEO of Wanxiang’s U.S. subsidiary Wanxiang America Corp. in Elgin, Ill. Independent consultant Tom Corcoran is also on the board.
A123 Systems used to be headquartered in Waltham, Mass., but now is based in Livonia, Michigan.
One of the major reasons failed was because a Fisker Karma plug-in hybrid with an A123 battery failed during an April 2012 test by Consumer Reports. Replacing the batteries was going to cost A123 Systems around $66.8 million, including $15 million in inventory charges. A123’s stock price plummeted over 85% as a result.
On October 16, 2012, A123 filed for Chapter 11 bankruptcy. A123 owed millions of dollars to debtors including the cities of Livonia, Novi, and Romulus. A123 has around $376 million in debt and around $459.8 million in assets. Johnson Controls attempted to acquire A123’s assets during the bankruptcy, but they lost the bid to Wanxiang in an auction. Wanxiang bought A123 for $256.6 million. A123 has been restructuring ever since then.
A123 cut employees and lowered operating costs and now they have 2,000 employees across the globe. A123 is expecting to hit $200 million in revenues this year and will break even for the first time in 2015. A123 is going to uphold the agreement of the DOE grant by maintaining their local infrastructure and jobs.
A123 is going to expand their low-voltage lithium-ion battery business to meet the demand for micro-hybrids. Micro hybrid systems have fuel-saving features like start-stop. This turns off the car’s engine as the car is stopped. A123’s current lithium-ion business will remain a supplier to General Motors, BMW, and SAIC Motor Corp.
A123 has also launched A123 Venture Technologies, which will focus on investments in battery-related startups. A123 Venture Technologies will also oversee the company’s research and development capabilities. Mujeeb Ijaz, former CTO, will become the president of this division.
[Source: Crains Detroit]