Sometime back, A123 Systems, Inc.(NASDAQ:AONE) was favorably viewed as a company that was going to change the face of the auto industry by providing Americans with battery-powered cars. However, after the initial, hullabaloo over electric cars died down, several factors surfaced such as development slowing down due to unexpected issues with battery technology, concerns about vehicles that might leave consumers stranded after the battery runs out, and astronomical expenses of electric cars.
The company filed for Chapter 11 bankruptcy on Tuesday. It had begun well by manufacturing lithium-ion batteries for power tools, and using this leverage had tried to generate large packs of batteries for vehicles. Big players like General Electric were interested and a grant from the US Government to build a plant in
Michigan was also approved in 2009.
The Obama administration, about 3 years back, had set a target that one million electric or plug-in vehicles will be out on American roads by 2015. The goal was way too optimistic to be achieved, given the financial and other types of constraints. Nissan and General Motors have sold 9,674 Leaf electric cars and 7,671 rechargeable Volt compacts, which is a drop in the bucket comprising 12.8 million light vehicles.