Shares of A123 Systems, Inc.(NASDAQ:AONE) were up 36.63%
to $0.750 after slumping 80% in the past couple of trading sessions.
A123 Systems, Inc.(NASDAQ:AONE), electric car battery
maker, which filed for bankruptcy this week, has been held up by Republicans as
a failure of the economic policies of the Obama Administration.
According to an analysis done by Bloomberg, while the
company had marquee customers and a promising future, its problems were a
result of its missteps in manufacturing.
About three years back the Obama administration had
pledged nearly $250 million in grants to provide financial help and also to
assist it in bringing back jobs and factories back to the U.S.
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Bloomberg said that the company had produced faulty
batteries "that forced its main customer, Fisker Automotive Inc., to
recall hundreds of $103,000 cars."
However the technology owned by the company will not
disappear as Johnson Controls, an auto parts maker, has offered to buy A123's
auto-battery business.
"The bankruptcy followed A123’s attempt to sell a
controlling stake to a Chinese company, an effort that fell apart amid scrutiny
by congressional Republicans. The offer from Johnson Controls has to be
approved by a U.S. Bankruptcy Court and could be topped by a rival
bidder," Bloomberg said in its analysis.
In the U.S. there are too many electric car battery
makers while the demand for electric cars is low, people still preferring to
drive around in gasoline-guzzling more powerful vehicles.
However considering the backing that A123 got with the
government, it surprised many that the company still went under.
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