A123 Systems gets DOE cash as it files for bankruptcy

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The A123 Systems bankruptcy saga notched another chapter as even after the election Republicans are still going after the DOE loan program, pointing out that the company got a million dollars in DOE loan money on the day it filed for bankruptcy. It hasn’t helped that A123 Systems got court approval to pay out $4.2 million in bonuses to 10 employees in exchange for those employees staying on during the asset auction. A123 Systems makes batteries for electric vehicles and well, that market has turned out to be much smaller than many anticipated.

The auction is set for December 6th and there’s been a lot of anger over efforts from Wanxiang Group to take over 80 percent of the company. Republicans have been crying foul, saying that US taxpayers are financing domestic R&D only to have it bought on the cheap by the Chinese (they may not have phrased it exactly like that, though that is precisely what irks many).  The other big bidder at the auction will be Johnson Controls and given the scale of financial commitment that Wanxiang has indicated it’ll give A123 Systems (around $450 million by most estimates), it might actually be the best thing for the company if a Chinese buyer with deep pockets comes in. As for keeping those jobs in the U.S., well that’s a different question.