Chrysler's Fiat 500 electric vehicle project needs a new battery supplier after A123 Systems pulled out after posting a second-quarter loss of $34.2 million, compared with a loss of $21.9 million a year earlier. Chrysler spokeswoman Katie Hepler said that A123 will not be supplying battery systems for the Fiat 500EV production program.
She described A123 to have been a good development partner in this program but she declined to provide further details. The partnership between Chrysler and A123, a Watertown, Mass., company with a battery plant in Livonia, was revealed last March.
The plan had been for production of the battery-powered Fiat 500EVs to start in 2012 at Chrysler's Toluca, Mexico, assembly plant, where assembly of gasoline engine 500s will start late this year. A123 CEO David Vieau said that a competing supplier is willing to purchase the business below current market price in a program which has considerably diminished in scale from what it expected earlier.
He said that it has yet to be determined if this issue will postpone the launch of the Fiat 500 EV. Chrysler is currently behind Ford, General Motors and Japanese automakers in the development of gasoline-electric hybrids and all-electric vehicles.
Chrysler didn't name the new supplier but it's well known that Ontario-based Electrovaya supplies lithium-ion batteries for a test fleet of about 140 plug-in Dodge Rams. Former Chrysler President Tom LaSorda is an adviser and director of Electrovaya.