Connect with us

Hi, what are you looking for?

Credit: Chanan Bos/CleanTechnica


Volkswagen Inks $1.4 Billion Battery Deal With Wanxiang A123

Wanxiang A123 says it has a deal with Volkswagen Group to provide up to $1.4 billion in LFP battery cells for use in the cars it manufacturers and sells in China,

Any story about battery company A123 must start way back in the dim mists of time when the EV revolution was just a dream in Elon Musk’s eye. The company was founded in 2001 by Yet-Ming Chiang, Bart Riley, and Ric Fulop and based on technology developed at MIT. By 2009, it had 2,500 employees worldwide and seemed poised to be a dominant player in battery production as electric cars began to appear on the road.

In May of 2008, the United States Advanced Battery Consortium — a collaboration between Chrysler, Ford, and General Motors — awarded the company a $12.5 million grant to develop its lithium-ion battery technology for plug-in hybrid electric vehicles. The US Department of Energy was part of that deal as well. 

A123 provided batteries to Henrik Fisker for his groundbreaking Karma plug-in hybrid, but that association soon came to grief after a series of battery failures took the luster off Fisker’s first attempt at building an electric car. Both Fisker and A123 filed for bankruptcy while politicians such as Mitt Romney harshly criticized Democrats for investing in A123, despite the fact that the federal investment was enthusiastically supported by Republicans.

Oddly enough, the assets of both companies were purchased out of bankruptcy by Wanxiang, which has rebranded the former Fisker holdings as Karma Automotive and has begun sales of an updated model loosely based on the Fisker Karma and known as the Karma Revero. Confused? You’re not alone.

The A123 battery business has also continued to evolve under Wanxiang’s guidance. This week, Ric Fulop, one of the original founders of A123, tweeted that Wanxiang A123 will supply approximately $1.4 billion worth of batteries to Volkswagen for its electric car models in China. According to InsideEVs, Wanxiang A123 will be the third battery supplier to Volkswagen Group in China, following in the footsteps of CATL and Guoxuan.

With this deal, Volkswagen has the following battery supply chain in place worldwide, says InsideEVs:

  • Europe (over 150 GWh from 2025): LG Chem, Samsung SDI, SK Innovation and CATL, as well as joint gigafactory with Northvolt
  • China (probably also over 150 GWh from 2025): CATL plus Guoxuan High-Tech Co Ltd. and now also Wanxiang A123
  • North America: SK Innovation

LFP chemistry eliminates cobalt from the mix, reducing costs and avoiding the social justice furor that surrounds cobalt mining. But until recently, it didn’t have the energy density to compete with conventional lithium-ion battery cells. That seems to be changing.

Tesla is now about to use LFP cells from CATL for its cars made in China. In the most recent earnings call, Elon Musk mused, “Total vehicle efficiency has gotten good enough — with Model 3 for example — that we actually are comfortable having an iron phosphate battery pack in Model 3 in China. That will be in volume production later this year. So we think that getting a range that is in the high 200s — almost 300 miles — with an iron phosphate pack, taking into account a whole bunch of of powertrain and other vehicle efficiencies, [is possible].

“And that frees up a lot of capacity for things like the Tesla Semi and other projects that require higher energy density [batteries]. So you have two supply chains that you can tap into: iron phosphate or nickel.”

The key to A123 was always its focus on so-called solid-state battery cells. LFP may not be solid state exactly, but it does avoid many of the fire and explosion risks associated with ordinary lithium-ion cells, which must be addressed at the module or pack level. The problem is caused by dendrites, tiny spikes of lithium sharp enough to pierce the internal structure of cells, leading to short circuits as illustrated below.


Credit: Chanan Bos/CleanTechnica

Recently, researchers at Lawrence Berkeley National Laboratory revealed they had developed a new semi-solid electrolyte that is both solid yet flexible. It is an amalgam of both polymers and ceramics. “Our dendrite-suppressing technology has exciting implications for the battery industry,” says co-author Brett Helms, a staff scientist in Berkeley Lab’s Molecular Foundry. “With it, battery manufacturers can produce safer lithium metal batteries with both high energy density and a long cycle life.”

The best part of the announcement is the new technology can be incorporated into battery cells with few if any modifications to the manufacturing process, making it more likely the new technology could make it out of the lab and into production quickly.

In an odd twist, one of the offshoots of the original A123 Systems was a new company called 24M that specialized in solid-state battery research and development. And what company is partnering with Lawrence Berkeley to test the commercial possibilities of its semi-solid state batteries? 24M, that’s who. The links between all these companies are Byzantine and possibly incestuous. But if they allow manufacturers to bring us lower priced electric vehicles, we say in the immortal words of  George W. Bush, “Bring it on!”

I don't like paywalls. You don't like paywalls. Who likes paywalls? Here at CleanTechnica, we implemented a limited paywall for a while, but it always felt wrong — and it was always tough to decide what we should put behind there. In theory, your most exclusive and best content goes behind a paywall. But then fewer people read it! We just don't like paywalls, and so we've decided to ditch ours. Unfortunately, the media business is still a tough, cut-throat business with tiny margins. It's a never-ending Olympic challenge to stay above water or even perhaps — gasp — grow. So ...
If you like what we do and want to support us, please chip in a bit monthly via PayPal or Patreon to help our team do what we do! Thank you!
Sign up for daily news updates from CleanTechnica on email. Or follow us on Google News!

Have a tip for CleanTechnica, want to advertise, or want to suggest a guest for our CleanTech Talk podcast? Contact us here.

Written By

Steve writes about the interface between technology and sustainability from his home in Florida or anywhere else The Force may lead him. He is proud to be "woke" and doesn't really give a damn why the glass broke. He believes passionately in what Socrates said 3000 years ago: "The secret to change is to focus all of your energy not on fighting the old but on building the new."


You May Also Like


Originally published on opportunity:energy. 2022 was a year of defeat for electric mobility in Italy. Europe’s fourth largest market struggled to keep up with...


The UK saw plugin electric vehicles take 22.9% share of the auto market in February 2023, down from 25.6% year on year. Overall auto...


The UK auto market saw plugin electric vehicles (EVs) take 20.0% share of new sales in January, flat from 20.4% year on year. Full...


Originally published on opportunity:energy. Italy’s EV market ended a weak 2022 with a December in line with the unimpressive figures posted in previous months....

Copyright © 2023 CleanTechnica. The content produced by this site is for entertainment purposes only. Opinions and comments published on this site may not be sanctioned by and do not necessarily represent the views of CleanTechnica, its owners, sponsors, affiliates, or subsidiaries.