Why A123Systems Lost the Volt Battery Deal

[MitchJi]

http://earth2tech.com/2009/01/12/why-a123systems-lost-the-volt-battery-deal/

Battery startup A123Systems was on a roll in 2008: It went into the year with a fresh round of capital (funds totaled $132 million in October 2007) and by May seemed to be headed for an IPO. But less than two weeks into 2009, the Massachusetts-based company has been defeated in a battle for what could be (if the automaker stays afloat) one of the biggest electric-vehicle battery supply deals in the country: GM’s Chevy Volt.

Granted, GM has said it will continue working with A123 (and other battery makers) “to support several [battery] companies and technologies.” But why did A123 lose out to LG Chem’s Compact Power for the major deal? According to GM vice chairman Bob Lutz, the automaker wanted flat, lithium-ion. The risks involved with working with a startup also played a factor.

The Michigan Business Review reports this explanation from Lutz:

A123 is still sort of a startup, they’re still ramping up, and A123 has been specializing mostly in…cylindrical cells, which are good with power tools and stuff. What we need here is prismatic, which is flat cells. And LG Chem is just farther along.

The question of flat vs. cylindrical lithium cells came up last week when Apple unveiled its new 17-inch MacBook Pro at the annual Macworld Expo in San Francisco. Apple’s move to the flat side stems from the company’s design interests (the computer is less than an inch thick, so the lower the battery’s profile, the better). GM has similar reasons: Prismatic designs allow for higher density of cells in lower-volume battery packs (read: more trunk space).

As for the decision to go with the more established company, it represents a safe (and in this economy, smart) move for GM. The little Volt carried much of the weight of GM’s pitch to Congress for bailout funds, and it would be a risky bet to rely on a startup that itself needs government aid to build out manufacturing facilities.

Lutz added a jab at U.S. policymakers for failing to support energy storage technology R&D at the level of counterparts in South Korea (where LG Chem has it’s headquarters) and Japan (the world’s EV and laptop battery heavyweight). Again, as reported by the Michigan Business Review:

This is one of the things why we say, if we’re serious about the electrification of the automobile, as part of the national energy policy we do need government support for advanced battery development, which of course Japan has. LG Chem has massive support from the Korean government in terms of a whole research campus was paid for by the Korean government because Korea recognizes that advanced battery technology is a key component of the country’s competitiveness.”

AND:
http://www.greentechmedia.com/artic...c-snub-is-a123-systems-on-the-ropes-5495.html

With General Motors Snub, Is A123 Systems on the Ropes?

...

Revenue has grown steadily, but so have losses. In 2006, revenue came to $34.3 million and losses amounted to $15.8 million. In 2007, revenue came to $41.3 million while the net loss came to $31 million. For the first nine months of 2008, revenue grew to $44.9 million and losses came to $52 million.

"We expect to incur significant future expenses as we develop and expand our business and our manufacturing capacity," the company stated in an SEC filing...

 

[Doctorbass]

What i wonder is how many cycles the LG Chem cells have??

this quote indicate that they will be Lithium manganese cells (same chemistry than the Konions !

While both sides are working with lithium-ion batteries, CPI is using LG's manganese oxide spinel chemistry and A123 is using an iron-phosphate chemistry.

Source:
http://blog.mlive.com/oak_business_review/2008/02/volt_battery_efforts_roll_ahea.html

Doc

 

[MitchJi]

Hi,

What i wonder is how many cycles the LG Chem cells have??

http://www.technologyreview.com/energy/21957/page2/

...

One of the biggest priorities at the company's new laboratory will be assessing and extending the lifetime of batteries. Lithium-ion batteries (commonly used in cell phones and laptops) lose their ability to store energy in just a couple of years. The Volt battery has been engineered to last eight to ten years, so that it doesn't have to be replaced during the lifetime of a vehicle, but to achieve this, the company had to oversize the battery pack to compensate for a loss in storage capacity. The pack stores 16 kilowatt-hours of electricity, but only 8 of these will be used for the car's 40-mile range. In the future, the company hopes to use far fewer batteries to achieve the same range.

...

The implication is that if the Konions are managed with a BMS and only 50% of the capacity is used they would last a lot longer.

 

[dogman dan]

Using only 50% of capacity is very good for cycle life. Keeps the cycle within the capacity of the runts.

 

[Doctorbass]

I would add.. 50% cycle life and low C rate demand! :wink:

Doc

 

[pwbset]

The Michigan Business Review reports this explanation from Lutz:

A123 is still sort of a startup, they’re still ramping up, and A123 has been specializing mostly in…cylindrical cells, which are good with power tools and stuff. What we need here is prismatic, which is flat cells.

Lutz is a putz. It's all political crap. A123 has an 11ah 3.3v nano prismatic cell that I have no doubt would equal or best the LG Chem stuff. See page 15 of this PDF:


View attachment 11_Dev_Batt_Packs_Space_Appl_DCarmen.pdf

 

[julesa]

Lutz is a putz. It's all political crap. A123 has an 11ah 3.3v nano prismatic cell that I have no doubt would equal or best the LG Chem stuff. See page 15 of this PDF:

Well, we know they exist, but the question is this: how many of them can they manufacture in a year?

 

[dnmun]

lutz was saying that they wanted to use the LG cells because the pouches had the cooling capabilities he needed with their design. i would expect pouches to always win over metal sleeved cells in a car because of the weight consequences since a car will have mechanisms to support and protect the cells. it may be that the pouches kinda float in the coolant with the terminals protected from the coolant by some partition through which the tabs exit the cell up into the gallery inside the battery pack where the connections are made, and the cylindricals make that difficult if not impossible, all in my imagination.

i was also under the impression there was still patent liabilities to University of Texas and dr goodenough hanging over a123. is that not the case?

the michigan plant will be established to assemble the packs, not clear is if they will manufacture the pouches there or bring them from korea initially and then maybe from china later assuming GM and LG form a partnership. with a reasonably simple BMS, they should be able to use LiMn as the chemistry without fire hazards associated with the lithium polymer cells, which were all cylindrical cells. and also i was under the impression that the sony cells had a manufacturing/assembly problem which led to the fires, supposedly a crimping machine was damaging the cells when crimping the end on. i cannot confirm that, but is my current understanding of the entire fire/failure stories resulting from overcharging and over discharging.

i know there is a lot of anecdotal evidence that keeping the degree of discharge to a minimum extends the life of the cells, but i wonder how much of that is supported by evidence. beyond the fact it is always better to carry more power than you will ever need as a simple measure to ensure the best performance. i actually think that to be the case, but not sure what supports the argument. from what i understand about lipoly the cathodic structure will collapse structurally as it is over discharged, and the use of lifepo4 eliminates that by maintaining a rigid structure in the cathode as it is overdischarged, and the damage from overdischarge may be to the anode in lifepo4. more opinion, baseless in fact, total conjecture.

 

[MitchJi]

Hi,

the michigan plant will be established to assemble the packs, not clear is if they will manufacture the pouches there or bring them from korea initially and then maybe from china later assuming GM and LG form a partnership

i know there is a lot of anecdotal evidence that keeping the degree of discharge to a minimum extends the life of the cells, but i wonder how much of that is supported by evidence. beyond the fact it is always better to carry more power than you will ever need as a simple measure to ensure the best performance.

Cells manufactured in Korea and packs assembled by GM in Michigan.

Its not anecdotal. In addition to all the testing by LG Chem of the performance of their cells GM did very extensive testing.

 

[Microbatman]

Pwbset

Well said

A123 has a flat cell and a factory to make them.

Probably lost the deal due to economics.

Still would love to test som LG cells and compare to A123

 

[MitchJi]

Hi,

The Michigan Business Review reports this explanation from Lutz:

A123 is still sort of a startup, they’re still ramping up, and A123 has been specializing mostly in…cylindrical cells, which are good with power tools and stuff. What we need here is prismatic, which is flat cells.

Lutz is a putz. It's all political crap. A123 has an 11ah 3.3v nano prismatic cell that I have no doubt would equal or best the LG Chem stuff. See page 15 of this PDF:

GM is on life support. They are investing a lot and staking a lot on the Volt. This is a crucial decision for that project. I don't think they would risk making this decision unless there are sound technical or economic reasons or concern that A123 might not be able to supply the cells.

As far as politics they are trying to get federal funding to stay alive. Politically it would be in their best interests to purchase the cells from a domestic company (A123).

 

[gogo]

As far as politics they are trying to get federal funding to stay alive. Politically it would be in their best interests to purchase the cells from a domestic company (A123).

Yes, it could easily be a ploy to get us to shovel even more money to GM to go domestic.