A123 Systems, Inc. (AONE)

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A123 Systems, Inc.
321 Arsenal Street
Arsenal On the Charles
Watertown, MA 02472
United States - Map
Phone: 617-778-5700
Fax: 617-778-5749
Web Site: A123Systems :: Home

DETAILS
Index Membership: N/A
Sector: Industrial Goods
Industry: Industrial Electrical Equipment
Full Time Employees: 1,696


BUSINESS SUMMARY
A123 Systems, Inc. designs, develops, manufactures, and sells rechargeable lithium-ion batteries and battery systems. Its batteries and battery systems, based on its proprietary nanophosphate chemistry, provide a combination of power, safety, and life. The company principally serves the transportation, electric grid services, and portable power markets in North America, Asia, and Europe. A123 Systems was founded in 2001 and is headquartered in Watertown, Massachusetts.

AONE: Profile for A123 Systems, Inc. - Yahoo! Finance

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Report: Global cleantech investment down 22% in 3Q
Research report says 3Q investment in global cleantech fell 22%; recovery forecast in 2010

By Sandy Shore, AP Energy Writer
On Friday October 2, 2009, 4:18 pm EDT
Buzz up! 0 Print.DENVER (AP) -- New global investment in clean-energy companies fell 22 percent in the third quarter as government financing was offset by tight credit markets, according to new research released Friday.

From July to September, new global investment totaled $25.9 billion, down 22 percent from a year ago and off 9 percent from the second quarter, according to London-based New Energy Finance, a global research firm.

But the sector appears to be heading toward a recovery, with investment nearly double what it was in the first quarter and investors growing more confident.

Many analysts think a turnaround will come in 2010 but caution that much depends on the U.S. economy, the health of the financial sector, natural gas prices and even electricity demand.

Asset financing, a key measure for solar and wind projects, fell 26 percent to $19.2 billion. Venture capital and private equity investment dropped 46 percent to $2.2 billion.

The third-quarter total, however, was nearly double the $13.3 billion recorded in the first quarter, said Ethan Zindler, who heads New Energy's North American research arm.

"Activity has certainly bounced off of Q1 (the first quarter), which was just when things came to a grinding halt," he said.

"I think the market has recognized that this industry is getting substantially more support from the federal government and other governments around the world," he said. "I think that helps bolster confidence as well."

Global public market financing rose 45 percent to $4.5 billion, yet shares of some companies still lag last year's value.

For example, shares of solar-power module maker First Solar Inc. closed Thursday at $143.76, down about 24 percent from Sept. 30, 2008, and solar technology company SunPower Corp. closed at $28.47, down nearly 60 percent.

Renewable energy is a small fraction of all power used but has gained favor globally as governments and businesses seek to curb pollution and the use of fossil fuels.

The industry lost momentum as access to credit markets dried up, natural gas prices fell and electricity demand diminished. Some companies were forced into bankruptcy while others shelved plans and cut jobs.

Billionaire oilman T. Boone Pickens put his plan to build the world's largest wind farm on hold last year amid the downturn and scrapped the plan altogether in July because of problems in getting power to a distribution system.

Many believe the industry will see immense growth in the coming years as utilities push to meet mandates to provide a percentage of electricity from renewable resources.

Governments worldwide have pledged to spend about $163 billion on stimulus programs to promote renewable energy, New Energy said.

The U.S. earmarked about $66 billion in stimulus money for renewable energy but more than 80 percent has yet to be allocated, New Energy Finance estimated.

In addition, the bulk of the money for announced allocations has yet to reach companies' bank accounts, analysts said.

"As you see those dollars really start to get into the system, you'll start to see some of the shovel-ready projects going first and a lot more jobs," said Scott Smith, U.S. leader of Deloitte's cleantech practice.

Some companies have found success by getting financing from both the government and investors.

For example, solar panel maker Solyndra Inc. received a $535 million loan guarantee from the federal government to complete a manufacturing facility in Fremont, Calif. It raised $198 million from investors.

Fuel cell maker Hoku Scientific of Hawaii delayed construction of a polysilicon plant in Idaho in June, citing financial woes. This week, it announced it signed an agreement to be acquired by TianweiNew Energy Holdings Co. Ltd., which will provide money to finish the plant.

A123 Systems of Watertown, Mass., which makes lithium-ion batteries, raised $380 million in an initial stock offering, received a $249 million Energy Department grant, secured $350 million in private capital and landed $100 million in refundable tax credits from the state of Michigan for a plant. Yet A123 Systems has never made money.
Horizon Wind Energy LLC considered using $1.2 billion it earmarked for U.S. investment this year on projects in other countries, but changed its mind and allocated $1.5 billion for U.S. projects because it can receive cash grants in lieu of tax credits.

"We are an example of a company that is now investing more in the U.S. than we were originally projected to," CEO Gabriel Alonso said. "Therefore, the more investments we make, the more jobs we create."

Cleantech Group LLC has forecast venture capital of about $5 billion to $6 billion for the sector this year, which roughly matches 2007 figures, Managing Director Dallas Kachan said.

He and Deloitte's Smith believe technologies that focus on energy efficiency, such as lighting and insulation, power storage and advanced batteries will benefit over the next year.

New Energy Finance forecast overall investment in clean energy will be $105 billion to $115 billion this year. That compares with $155 billion in 2008 and $148 billion in 2007.

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Proton Exchange Membrane Fuel Cells: Is This The Most Power Efficient Alternative Energy Source For Transportation?

67 WALL STREET, New York - October 7, 2009 - The Wall Street Transcript has just published its Alternative Energy/Clean Energy/Power Generation/Utilities

Topics covered: Long Term Perspective on Alternative Energy Industry -- Leading Indicators for Alternative Energy Components Companies -- Mergers and Acquisitions in the Alternative Energy Industry -- Break Even Business Fundamentals for Carbon Free Energy Providers -- Development of Carbon Free Energy Production Infrastructure -- NAT GAS Act -- New Players in the Alternative Energy Industry -- Solar Power Cell Manufacturers Market Strategy -- Demand Response for Raw Materials for Solar Cell Production -- Alternative Energy Investment Opportunities -- Multiple Stock Winners in Carbon Free Production Industry -- Government Funding of Alternative Energy Power Providers -- Chinese Solar Energy Companies -- Alternative Energy Hedge Fund Investors -- Commodity Cycles -- Determinants of Market Valuations in the Alternative Energy Production Industry -- Carbon Emissions Statistics -- Energy Efficiency Statistics -- Innovations in Solar and Wind Power Generation -- Business Economics for Methane Based Power Generation -- Electric Vehicles Projections and Statistics-- Cap and Trade Projections and Statistics -- Development of Battery Technology -- Regulatory Environment Developments for Solar, Wind, and Alternative Energy -- Hybrid Vehicles Development and Sales Projections

Companies include: Tanfield (TAN.L); Smith Electric Vehicles U.S.; Valence (VLNC); Spire (SPIR); Newport (NEWP); MYR Group (MYRG); Primoris (PRIM); Tetra Tech (TTEK); EnerNOC (ENOC); Comverge (COMV); EnergyConnect (ECNG.OB); Calgon Carbon (CCC); and Ener1 (HEV); Westport Innovations (WPRT); Clean Energy Fuels (CLNE); Fuel Systems Solutions (FSYS); FuelCell Energy (FCEL); FEI Company (FEIC); Veeco (VECO); ATT (T); Landi Renzo (LR.MI); Teleflex (TFX); Royal Dutch Shell (RDS.A); Wal-Mart (WMT); Pepsico (PEP); FuelMaker; Chevrolet; GM; Honda (HMC); Itron (ITRI); Siemens (SI); American Superconductor (AMSC); GE (GE); and ABB (ABB);

In the following brief excerpt from just one of the 23 interviews in the 83 page report, an industry experts on fuel cell technologies discusses the outlook for the sector and for investors.

Brian Piccioni is a Toronto-based Analyst with BMO Capital Markets, where he primarily covers hardware stocks. Prior to joining BMO Capital Markets in 1998, he was an Analyst with another investment dealer, which specialized in researching and financing Canadian technology companies. Mr. Piccioni was previously a Hardware Manager at Eicon Technology, a data communications firm in Quebec. He holds a B.S. in biology from McGill University and an MBA from Concordia University.

TWST: So you don't consider Ballard an alternative energy company?

Mr. Piccioni: I do not consider it an alternative energy company.

TWST: What is your advice to investors who are looking at getting into investing in companies that label themselves "alternative energy" companies?

Mr. Piccioni: Well, the first thing I would do is I would very carefully analyze what's going to happen if government subsidies go down. This is a major problem for the solar sector right now because as we had predicted sometime ago, it's basically held afloat by government subsidies. And as governments run into deficits, those are subsidies that are fairly easy to trim. So you have got to sit back, and you've got to look at these companies and say, "Which ones are viable on their own merits, which ones are targeting market segments that the application of the alternative energy, in and of itself, provides a viable commercial model?" Now people say, "Oh well, we'll get the government subsidies. We just sell solar cells, or we just sell windmills, or whatever." But the overwhelming majority of installations are subsidized through one mechanism or another. So that's what you've got to do is you've got to look at any investment and say, "Okay, if we take away government money - because political decisions can be made on the basis of different reasons, like frugality, for example - so if you take away the government money, is this a viable business?" Many of these can't pass that test. There is also, quite frankly, a number of companies, and I'm obviously not going to name names, who are essentially running scams. They are talking about technology that people who are very knowledgeable in physics and in chemistry will tell you that just cannot ever come to fruition. So how do you get around those? If you know somebody who is a professor at a university who teaches physical chemistry or something like that, you might bounce a few ideas off of them. And don't expect an analyst or journalist to do that for you. Like I said, most people don't understand this stuff. But at the end of it, I would say, in particular now, be very cautious because if government spending pulls back, which it should - I mean look at the deficit in the U.S. alone, and that's repeated in countries all over the world, including many countries that have been firm proponents of alternative energy - well, the sector is going to get under enormous pressure. My overwhelming comment is: Be very, very careful.

TWST: Turning back to Ballard, what needs to happen to create a significant commercial demand for their PEM fuel cells?

Mr. Piccioni: Interestingly enough, if you would have asked me that five years ago, I would have talked about things like durability, cost of materials, stuff like that. But now it's almost there. I've spoken with significant companies who are partnering with Ballard, and they talk about dramatic improvements in the business outlook over the past year or so. Take electric grid backup in the developing world for cellular base stations. That's a situation where in many countries of the world, you have electricity eight to 14 hours a day, and the rest of the day you don't have electricity. It's very difficult to believe from where we sit, but as a consumer there, you sort of accommodate that. If you are a mobile operator, you have got to be able to deliver service to your customers 24 hours a day. So a sizable proportion of these cell sites have diesel generators, which are running at very high-duty cycles. So they are running eight, 14, 16 and in some places in Africa, literally 24 hours a day. Now diesel generators are reasonably energy efficient, provided you are running them near their rated load. But you can't make a diesel generator, practically speaking, that runs efficiently with only a 5,000-watt load. So as a result, these things are not running at anywhere near optimal efficiency. And the other thing is the diesel fuel is relatively expensive. It's fairly easy to convert natural gas or propane to hydrogen. And I say easy, I mean there are complications that will be impractical for doing that in an automobile. But it's doable when you are dealing with a relatively modest amount of hydrogen, and you have to have a fuel cell that can deal with that type of fuel, which is called reformate. It works out that because fuel cells are so efficient, even if you use this inefficient mechanism to use natural gas - because natural gas is so inexpensive - when you do the math, there is a huge payback for using a fuel cell. Remember we are using a 5,000-watt fuel cell running off natural gas reformate instead of 15,000-watt diesel generator to give 5,000 watts. It turns out you are paying for the system and in a very short time. I have gone over and crosschecked those calculations from a base level; I have verified everything, I have spoken with people involved in the project, and so on and so forth. This is here and now, and it's a tremendously compelling solution. So there are a huge number of base stations being deployed in the developing world in places where the grid is unreliable, and here is an opportunity to say, "Forget about the green aspects and all the rest of it. Yes, yes, it's green and everything else, but here is how we save your money from the minute we switch the system on."

TWST: What is the competitive landscape like? What portion of that market can Ballard capture?

Mr. Piccioni: Well, it's hard to say. There's bound to be some push-back, companies trying to come up with more power-efficient generating systems and stuff like that. There is bound to be some resistance because of the new technology. But I would say that in those type of applications, fuel cells could probably end up, over a long period of time, being held or basically being sort of 100% duty cycle, at least in areas where natural gas and/or propane are at least as available as diesel fuel. If you have got some sort of weird situation where for some reason there is no availability of natural gas or propane, where you can truck in diesel, well that might be a different situation. There are many companies that claim to be in the PEM fuel cell business but only a very small number of those actually have products for sale commercially. So I assume that Ballard could have a fairly significant market share of the market as it evolves. But this is a thing that will evolve over probably a decade, not over the next two years or so.

The Wall Street Transcript is a unique service for investors and industry researchers - providing fresh commentary and insight through verbatim interviews with CEOs and research analysts. This 83 page special issue is available by calling (212) 952-7433 or via The Wall Street Transcript Online .

The Wall Street Transcript does not endorse the views of any interviewees nor does it make stock recommendations.

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WATERTOWN, Mass., Oct. 12, 2009 (GLOBE NEWSWIRE) -- A123 Systems, Inc. (Nasdaq:AONE - News), a developer and manufacturer of advanced lithium-ion batteries and battery systems for the transportation, electric grid services and consumer markets, announced today that it will release its third quarter 2009 financial results for the period ended September 30, 2009 after the market close on Tuesday, November 10, 2009. On that day, management will hold a conference call and webcast at 5:00 p.m. ET to review and discuss the Company's results for the third quarter. A recorded version of this webcast will be available two hours after the call and accessible at A123Systems :: Company :: Investor Relations :: Investor Home.

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GE brings good things to startups
October 15, 2009 8:00 AM

Conglomerate invests money – and its considerable resources – in young energy firms.

By Marc Gunther, contributing editor


GE's Urquhart offers startups cash and connections. Photo: GE
When A123 Systems (AONE), a startup company that makes advanced lithium-ion batteries, had a successful initial public offering last month, one of the big winners was General Electric (GE).

That’s because A123 Systems is by far the biggest holding of a venture capital fund run by GE that invests in energy startups. Over six rounds of funding, GE had invested $69 million in A123, which makes batteries for cars, trucks, buses, utilities and consumer products, like Black & Decker tools.

Today, GE is A123’s biggest shareholder and its stake in the company is worth about $190 million.

With little fanfare, GE’s venture fund has been investing in a broad variety of energy startups since 2006. Most of the investments are small—so far, GE has invested about $160 million in 20 companies.

Besides its cash, the industrial giant brings credibility, relationships and expertise to its portfolio companies. “We’re one of the top-tier players in energy,” said Alex Urquhart, the president and CEO of GE Energy Financial Services, a unit of GE Capital that manages the fund. “We bring a lot more than money. We bring connections. We bring R&D.”

This week, GE invited executives from its portfolio companies and reporters to its Global Research Center in Niskayuna, N.Y., to talk about the venture business. GE has backed startups in wind, solar and wave energy, companies seeking to profit from energy efficiency and the so-called smart grid, as well as a handful of oil and gas firms.

A "popcorn stand" today; tomorrow, the future of energy?

To put the venture operation in context: GE Energy Financial Services has $22 billion of global energy investments, most in fossil fuels, pipelines, electricity transmission and distribution. Of that total, more than $4 billion is invested in renewable energy projects, like utility-scale wind farms or solar plants. By comparison, the energy venture fund is a popcorn stand.

But GE is betting that at least a few of its startups will profit from big global trends: growing demand for power, long-term supply constraints, rising production costs and pressures to drive the world economy with low-carbon energy sources.

“The people in this room have the opportunity to change the world we live in and create new $1 billion industries,” Urquhart said. GE announced two new deals at the event. The company joined with venture capital funds in the U.S., Singapore and Israel in a $23-million round of investment in SolarEdge, an Israeli firm with technology aimed at increasing the output of solar photovoltaic panels.

It also invested in a Colorado startup called Tendril, whose technology enables real-time communication between utility companies and their customers, as part of the smart grid. Financial details weren’t disclosed.

Kevin Skillern, who manages the venture fund, told FORTUNE that it has already more than earned out its $160 million in investment. Besides A123, two other GE-backed startups have gone public—a Chinese company now known as China High Speed Transmission Co. that makes gear boxes for wind turbines, and Orion Energy (OESX), a Wisconsin-based firm that does energy-efficient lighting retrofits for big companies.

Both, it turns out, were helped by GE’s cachet–and clout. The Chinese company, formerly known as Nanjing Gear, got GE’s attention several years ago when GE rival Siemens (SI) acquired another Chinese firm that had been GE’s biggest supplier of gear boxes, a critical component for GE’s wind turbines. GE subsequently began buying gear boxes from Nanjing and invested about $20 million in the company, according to Skillern, who said that GE’s stake is now worth $160 million.

Orion, meanwhile, is a GE customer and supplier. It has sold its lighting retrofits to GE, as well as other FORTUNE 500 companies including Coca-Cola and Kraft. Orion buys light bulbs and electronics from GE.

Since going public in 2007, Orion’s shares have fallen in value by 75%, so GE has lost money on that deal. Other GE startups also have struggled. Think, an electric car company based in Norway, went bankrupt, but has since emerged with big plans for make cars for Europe and the U.S.

Interestingly, while GE's own energy business, which had nearly $30 billion in 2008 revenues, focuses on large-scale, centralized gas, coal and nuclear power plants, its venture fund is betting on small-scale distributed energy.

Boosts from subsidies and stimulus money

Last spring, GE invested alongside Rockport Capital and Chevron’s venture arm in Southwest Windpower, the world’s largest manufacturer of small wind turbines. Based in Flagstaff, Arizona, Southwest Windpower makes wind turbines that sell for about $15,000 to homeowners, commercial and off-grid customers.

Frank Greco, Southwest’s CEO, said that after federal and state tax credits are factored into the cost, the electricity generated by its 2.5 kilowatt Skystream turbine “is currently competitive and in some cases lower than centrally supplied retail power.”

Government support is crucial to many of GE’s investments. A123Systems and Southwest Windpower benefit from federal tax subsidies for renewable energy. A123 also received more than $600 million in federal and state stimulus funds to build a plant in Michigan to create so-called green jobs.

GE executives said the energy venture fund looks at about 1,000 business plans a year. “We’ve got unbelievable depth in technology that helps us pick winners and, even more important, accelerate the commercialization of technology, which is really what the game is all about,” said Steve Fludder, president of GE’s ecomagination initiative. “Scale can turn these innovative companies into billion-dollar revenue streams.”


GE brings good things to startups - Fortune Brainstorm Tech

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Bullish inverted head and shoulder pattern building...

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AONE Major Holders | A123 Systems, Inc. Stock - Yahoo! Finance