Since battery-maker A123 was acquired by China’s Wanxiang Group, it has shifted its focus to concentrate on starter batteries, and has big plans to produce batteries for microhybrids, aka start-stop systems.
A quarter of the company’s revenue still comes from EV battery packs – its factory in Hangzhou is running at full capacity to supply batteries for electric buses and cars in China.
Meanwhile, A123’s two Detroit factories are similarly busy building starter batteries for Mercedes-Benz, and CEO Jason Forcier expects to launch production of microhybrid batteries in 2017 or 2018.
“We won’t spend too much effort on the EV markets in Europe or the US, because we don’t see them as viable markets in the next 10 years,” Forcier told Automotive News.
The strategy seems to be working – revenue is expected to grow to $300 million this year, up from $200 million in 2014.
A123’s third-generation 12-Volt starter battery has more than four times longer life than legacy lead-acid designs, and weighs half as much. According to the company, its system can deliver up to 10% greater efficiency compared to lead-acid.
A123 now has supply relationships with five European OEMs. Forcier says industry behemoths LG Chem and Samsung are also eyeing the market for lithium-ion starter batteries, but he’s optimistic about his company’s prospects, partly thanks to the deep pockets of Wanxiang. “Our parent has been investing, and our financial concerns are gone.”