Robert D.

Alternative Energy Storage and Blood in the Streets

Would the increased push to reduce lead levels in the United States affect lead-acid sales (at least in the US)?

What are the environmental pros and cons from a legislative point of view in the use of lead-acid vs. Li-ion? (How much safer (environmentally) would the widespread use of Li-ion vs lead batteries be?)

Alternative Energy Storage and Blood in the Streets

John thanks for sharing your knowledge in this sector.

I am taking a deeper look into A123's S-1, and noticed the following:

"We have had negative cash flow before financing activities of $17.0 million for 2005, $29.1 million for 2006, $56.1 million for 2007 and $13.5 million for the three months ended March 31, 2008. We anticipate that we will continue to have negative cash flow for the foreseeable future as we continue to make significant future capital expenditures to expand our manufacturing capacity and incur increased research and development, sales and marketing, and general and administrative expenses."

Assuming expenses remain constant (even though they plan on spending heavily on R&D, and rightly so), my main concern is that sales will not catch up to the increase in R&D, most likely pushing them to a secondary offering, diluting shares.

Unfortunately I am not too familiar with their products, demand, competition, costs, etc... But my main question is, do you foresee sales to make up for the increase in R&D, and most importantly based on what quantifiable data?

Nonetheless, it looks like the market hype will push the stock price higher at least in the short-term. But I'd be concerned as a long-term investor.