Most Charged readers will certainly remember A123, the company that was founded in 2001 on the basis of promising battery technology developed at MIT; received a $249-million grant from the DOE and $100 million in tax breaks from the state of Michigan; raised $380 million in a 2009 IPO; made a bad bet on Fisker Automotive; went belly-up in 2012, making the taxpayers’ and investors’ money vanish into thin air; was bought by Chinese conglomerate Wanxiang Group; and carried on its business, with the same partnerships and projects, and most of the same management team (as detailed in a feature in the October 2013 issue of Charged).

A couple of years later, A123 is doing very nicely, thank you. CEO Jason Forcier says that this year, revenue should reach $300 million, and the company will break even for the first time. A123 plans to invest $800 million over the next four years to expand its plants in North America and China, and build new ones in Europe.

A123 has found a profitable niche producing low-voltage Li-ion batteries, which are used as starter batteries in a few high-end sports cars, and in start-stop or micro-hybrid systems. In April, A123 introduced UltraPhosphate, a low-voltage Li-ion battery designed to deliver more power at lower temperatures than lead-acid models. A123 also supplies high-voltage batteries to Chinese manufacturers including Chery, Shanghai Automotive and bus maker Tianjin Santroll.

Depending on your political perspective, the A123 saga is a parable that illustrates the folly of government investment in risky startups, or the folly of bankruptcy laws that allow corporate executives to walk away from obligations to taxpayers and investors with no consequences.

Either or both narratives may become an issue in the upcoming US presidential election. The Republican National Committee has filed Freedom of Information Act requests related to Wanxiang’s purchase of A123, and, as reported by Bloomberg, is hoping to find evidence that Democratic candidate Hillary Clinton played a role in the tawdry tale.

It should be no surprise that Wanxiang’s name is nowhere to be seen at A123’s Livonia, Michigan headquarters. “You wouldn’t know it is a Chinese company,” says VP Jeff Kessen. “We don’t hide it, but we don’t promote it.”

Source: Bloomberg