A123 has one of the broadest customer pipelines in the industry, Mr. Forcier said. It sells battery cells, modules, and packs to more than 40 programs under development and 20 major customers. In addition to BAE, Daimler, and Black & Decker, customers include Procter & Gamble, Magna, General Motors, General Electric, and Delphi, he said.
The company was “very fortunate” to raise the funds needed to invest in the industry, Mr. Forcier said. “As you hear about all these great new technologies, you really can’t go anywhere without about $1 billion in cash available,” he said. “That really is the state of the battery industry. If you’ve ever been in a lithium-ion battery plant, you know that it is a very capital-intensive business.”
A123’s cash raised most of its cash, $400 million, through its 2009 IPO, Mr. Forcier explained. A123 also received a $250 million DOE grant and a $110 million grant from Michigan. The company is in final due-diligence negotiations with the DOE for an additional $233 million loan. “So we are well-capitalized, and that is important,” Mr. Forcier said. It takes up to $200 million to $300 million to build one lithium-ion plant to supply batteries for 20,000 to 30,000 plug-in or electric vehicles.
FIGURE 2 Funding for operations.
SOURCE: Jason Forcier, Presentation at July 26-27, 2010 National Academies Symposium on “Building the U.S. Battery Industry for Electric Drive Vehicles: Progress, Challenges, and Opportunities.”