A123 Systems (AONE -14.3%) resumes its three-day 30% swoon since announcing it would replace...

A123 Systems (AONE -14.3%) resumes its three-day 30% swoon since announcing it would replace battery packs due to a manufacturing defect. Deutsche Bank cuts shares to Hold, saying the estimated $55M cost "represents a severe impact" to a company with just $187M in balance sheet cash at year-end 2011 and that had projected free cash burn of at least $155M in FY2012.

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Comments (2)
  • Stoploss
    , contributor
    Comments (1713) | Send Message
    Insert fork here.
    28 Mar 2012, 11:43 AM Reply Like
  • Conventional Wisdumb
    , contributor
    Comments (1800) | Send Message
    I think this is what is colloquially known as a "Death Spiral".


    Either they do a secondary or someone buys them really cheap. Either way existing shareholders appear to be in for a further surprise.


    Yup another metaphor for the success of the Obama economic vision:


    "THE PRESIDENT: Well, look, I wish I could be there in person to celebrate with you today. But I am calling to congratulate A123 Systems on this tremendous milestone. As you said, thanks to the Recovery Act, you guys are the first American factory to start high-volume production of advanced vehicle batteries.
    And I want everybody to understand just a few years ago American businesses could only make 2 percent of the world’s advanced batteries for hybrids and electric vehicles -- just 2 percent. But because of your extraordinary work, thanks to the Recovery Act, we're going to get up to 40 percent of the world’s capacity. And that means when folks lift up their hoods on the cars of the future, I want them to see engines and batteries that are stamped: Made in America. And that's what you guys are helping to make happen. (Applause.)


    So I want to thank your great governor, Jennifer Granholm, for her vision in jumpstarting a homegrown clean energy industry. "
    28 Mar 2012, 11:46 AM Reply Like
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