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A123 Systems (AONE) officially files for bankruptcy protection. The electric car battery maker...

A123 Systems (AONE) officially files for bankruptcy protection. The electric car battery maker warned last night it might file for bankruptcy after defaulting on a loan payment. It remains to be seen how the filing affects A123's financing deal with China's Wanxiang Group. Shares -50% to $0.12.
Comments (17)
  • rambler1
    , contributor
    Comments (394) | Send Message
     
    Another basket case supported by our gov't to the tune of $250mil. Let the free markets decide where the $'s get spent.
    16 Oct 2012, 09:05 AM Reply Like
  • bjervey
    , contributor
    Comment (1) | Send Message
     
    And cut all that gov't support for fracking R&D, too, right? Our natural gas boom is 100% due to decades of gov't support. And thank goodness for that. Energy innovation (whether fracking, nuclear, or renewables) is dependent on R&D support that the free market won't risk. Without it, we're back in the stone ages.
    16 Oct 2012, 09:41 AM Reply Like
  • desperado219
    , contributor
    Comments (8) | Send Message
     
    Please show me the proof of your statement re: gov't support for fracking R&D, nat gas boom 100% due to gov't support. I've been in the industry off/on for 30 years and your claim is news to me.
    16 Oct 2012, 10:18 AM Reply Like
  • JohnInMA
    , contributor
    Comments (45) | Send Message
     
    Why do people always point to every other subsidies, grants, incentives, etc., in an attempt to justify bad ones? It has a hint of jealously or envy to it. A type of, "they get it so why can't mine (my favorites)????"

     

    Perhaps if the federal government were focused on R&D and technology more than commercial subsidy renewable energy success would be much further along. It might not eliminate the currently rampant cronyism, but it would at least give the industries a better chance to overcome technical hurdles. And it's not as if tax dollars are not targeted at R&D to a large degree. Just look at the amount of monies allocated to academic research and the portion that is public funds (over half). One would expect better results - not necessarily in a technical deliverable but more in an entrepreneurial/business sense. There is a disconnect between public research and markets.
    16 Oct 2012, 11:23 AM Reply Like
  • caupachow
    , contributor
    Comments (330) | Send Message
     
    @bjervey 100% wtf are speaking about? When one makes a statement like that back it up with at least some made up facts.
    16 Oct 2012, 07:46 PM Reply Like
  • rabdoes
    , contributor
    Comments (30) | Send Message
     
    There was a time Obammy would mention these guy's every time he came to Michigan.

     

    Maybe he should stay focused on health care. heheheheh
    16 Oct 2012, 09:14 AM Reply Like
  • rambler1
    , contributor
    Comments (394) | Send Message
     
    Re: Obama focus on health care. Charlie Brown's reaction would be "AAAAAGGGGHHHHH!"
    21 Oct 2012, 05:29 PM Reply Like
  • Felix (amateur scientist)
    , contributor
    Comments (37) | Send Message
     
    Readers will recall that our very own John Peterson, contributor to Seeking Alpha, predicted this situation long ago based on existing financial information. Unfortunately naysayers doubted the financial information. I was surprised at the responses and reactions from the green side to John's former postings. He was simply predicting the inevitable based on the financial information available. I worked at a utility company that declared bankruptcy protection and eventually came out of bankruptcy. However, the utility had a revenue source - their captive utility customer. Unfortunately, A123 Systems does not have such a constant customer base. A stronger sales and business development plan is needed to build revenue.
    16 Oct 2012, 10:02 AM Reply Like
  • JohnInMA
    , contributor
    Comments (45) | Send Message
     
    Why would people who believe in and perhaps fight for no strings attached federal subsidy buy into a real financial analysis, even when performed by credible sources like John Peterson? After all, the point of many incentive programs is not usually to give a company or an entire industry a slight bump over a hurdle. More often, the programs are structured so that bureaucrats are given the power to select on a number of bases, of which that 'bump' MIGHT be one. But often it isn't. In the case of many 'clean' or 'green' subsidies the factors of viability are less important than changing market dynamics in favor of the chosen direction. It isn't yet obvious, but it may be reasonable to suspect post-Solyndra politics are a factor in the situation at AONE. Even with such a balance sheet, business model, and forecasts, I suspect there might have been further funding. Likely the potential deal with Wanxiang is a factor also, from a political angle.
    16 Oct 2012, 11:37 AM Reply Like
  • Ian Bezek
    , contributor
    Comments (1081) | Send Message
     
    Obama: Creating jobs -- for bankruptcy lawyers!
    16 Oct 2012, 12:59 PM Reply Like
  • GaltMachine
    , contributor
    Comments (1135) | Send Message
     
    Apparently Romney was right when he said:

     

    http://bit.ly/SZjZaU
    "At Wednesday night's presidential debate, GOP candidate Romney summarized the difference with this zinger: "You put $90 billion — like 50 years worth of tax breaks — into solar and wind, to Solyndra and Fisker and Tesla and Ener1," he told the president. "I had a friend who said: 'You don't just pick the winners and losers; you pick the losers.' "

     

    In Sept 2010 the President said:

     

    http://bloom.bg/SY0lR0
    President Barack Obama called A123’s CEO Vieau and then- Michigan Governor Jennifer Granholm during a September 2010 event celebrating the opening of the plant in Livonia that the company received the U.S. grant to help build.
    “This is about the birth of an entire new industry in America -- an industry that’s going to be central to the next generation of cars,” Obama said in the phone call, according to a transcript provided by the White House. “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.”
    16 Oct 2012, 01:08 PM Reply Like
  • PaulTD
    , contributor
    Comments (1097) | Send Message
     
    "You put $90 billion — like 50 years worth of tax breaks — into solar and wind, to Solyndra and Fisker and Tesla and Ener1,"

     

    Wow!!! That's like, $30 billion more than the fantasy cost to invade Iraq, but less than 3% of the actual/projected final tally (which would be a thousand years or more of tax breaks if the US lasts that long).

     

    Think of all the jobs that Romney will create if he gets elected and invades Iran! Oh goody!

     

    PaulTD.
    16 Oct 2012, 07:16 PM Reply Like
  • GaltMachine
    , contributor
    Comments (1135) | Send Message
     
    PaulTD,

     

    Lighten up. As usual ignore the failure and attack a straw man, typical Democratic political strategy.

     

    This was a total failure and a complete waste of taxpayer money on an industry that had no hope of producing a profit which is a scandal whether you are on the left or right of the political spectrum.

     

    If you are not willing to hold our politicians accountable then we will never have positive change in this country.
    17 Oct 2012, 10:35 AM Reply Like
  • Gary Jakacky
    , contributor
    Comments (2392) | Send Message
     
    YAY!!!!! Finally! Take Governor Patrick and the Anointed One with you!
    16 Oct 2012, 02:16 PM Reply Like
  • HackFab
    , contributor
    Comments (983) | Send Message
     
    http://bit.ly/TtNi5T
    "Vice President Joseph Biden heralded the Energy Department's $529 million loan to the start-up electric car company called Fisker as a bright new path to thousands of American manufacturing jobs. But two years after the loan was announced, the job of assembling the flashy electric Fisker Karma sports car has been outsourced to Finland."

     

    Yup. Picking winner since 2009. I feel so.... Green?
    16 Oct 2012, 04:32 PM Reply Like
  • nasdaqwoody
    , contributor
    Comments (147) | Send Message
     
    Government grants for basic research can be a good thing. Eg research on the effect of fracking on ground water or research on new battery technologies.

     

    Government investment start up companies is almost always a bad idea. Companies that have good business plans,solid management and great technology will find capital. Those without one or more of these essentials will look for dumb money. That is usually found in DC.
    16 Oct 2012, 09:16 PM Reply Like
  • Felix (amateur scientist)
    , contributor
    Comments (37) | Send Message
     
    NasdaWoody, Good last points about good business plans find capital. After further thinking there is (or was long time ago) a need for basic research funded by our research universities. For example the old traditional Agricultural universities did excellent research.

     

    However, it appears when that research seeks federal or state money to commercialize its research into products, and a profit making commercialized business is when we run in trouble.

     

    But on the flip side, the defense industry relies on the government markets for its products and revenue streams so we need to be careful in spouting out vitriol.

     

    In practice, the "subsidized markets" seem to take a life of their own over time and continue on until market forces say otherwise. For example, I work in the utility industry. My original positions were focused more on our core business (delivery of electric and gas). But as energy efficiency gained more prominence the Utilities Commissions and Utilities crafted "energy efficiency programs and rebates" funding by a public goods charge in the rate (a subsidy?). The energy efficiency markets took off and the rest is history. But many suppliers to this industry depend on the rebate programs. Is this a subsidized market? Thanks for reading my notes.
    16 Oct 2012, 11:52 PM Reply Like
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