Chrysler Group has been
forced to look for another manufacturer to develop
battery packs for the Fiat 500 EV project which it hopes
to introduce in production format onto the North
American markets in 2012 after A123 Systems dropped out
of the programme a little over a year after it signed an
agreement with the US. carmaker.
"A123 will not be
supplying battery systems for the Fiat 500 EV production
program, A123 has been a good development partner in
this program and we appreciate their support. We have
nothing else to announce at this time. Our plans for the
EV are the same and this does not impact the program
timeline," a spokesperson for Chrysler Group responded,
also stating that a replacement company would be
announced in the "not too distant future."
It comes as Watertown, Massachusetts-based A123 Systems,
which cites the "diminished" Chrysler Group EV programme
as the reason for dropping out, continues to lag behind
it's two main automotive battery market rivals, Johnson
Controls and LG Chem, and on Tuesday it announced a
larger Q2 loss (US34.2m to US21.9 m year-on-year). It's
shares lost nearly 20 percent of their value on Tuesday
and are down over 60 percent for the year. However A123
Systems, which was founded in 2001, has also revealed
this week that it is has signed a new battery deal with
an unnamed OEM's hybrid programme.
Chrysler's previous owners, Cerebus Capital Management,
signed a contract with A123 Systems last April just as
the carmaker was surviving on a drip feed of state
bailouts to support it's operations and only weeks prior
to it entering the Chapter 11 process. At that point a
huge electric vehicle (EV) programme was proposed that
would span right across the carmaker's range. Chrysler's
EV prototypes were the centre stage exhibits at major
motor shows early last year: the Chrysler-badged 200EV
was a concept sedan while the Dodge Circuit EV was
another eye-catching concept, this time a two-seat
sports car based on the Lotus Exige. Finally Jeep also
showed off the Patriot EV prototype. When he Fiat Group
took management charge the ambitious programme, known
internally as "ENVI", was canned and the engineers
reassigned to other departments.
Fiat Group and Chrysler Group CEO Sergio Marchionne has
never made any secret of his belief that electrification
isn't presently viable, and in his five year business
for Chrysler Group presented late last year EV
production is billed at being just over 50,000 units per
annum by 2014. Instead Marchionne sees downsizing and
constantly improving the efficiency of conventional
petrol and diesel engines as the way forward and Fiat
Group is a world leader in this technology. Chrysler
Group's five year business plan did consider bringing an
electric version of the Fiat Doblò LCV stateside but
this proposal has since been quietly dropped.
With Chrysler Group
lagging a long way behind it's two Detroit rivals in
electrific and hybrid vehicles and partially, suggest
industry watchers to justify helpings of U.S. taxpayer
cash specifically aimed a pursuing alternative energy
formats that it has taken, the Fiat 500EV has been
proposed for the North American markets. The 500EV,
which will be built at Chrysler's Toluca, Mexico-plant
alongside the North American-bound petrol models, has
been proposed for a 2012 launch while the Italian
brand's supermini is expected to make its U.S. debut in
selected Chrysler showrooms from the end of this year.
Chrysler Group isn't expected to be short of alternative
offers to step into A123 System's shoes. One option
could be Electrovaya which is currently supplying
batteries to a Ram truck hybrid project.
