What America Learned From the Demise of its EV Battery Pioneer

The US is trying to rebuild its battery industry after the failure of A123 Systems.

Tesla cars charging in San Francisco.

Gabrielle Coppola

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Only battery industry veterans or political buffs are likely to recall the tale of A123 Systems.

Spun out of the Massachusetts Institute of Technology in 2001, A123 was the first company to commercialize lithium iron phosphate batteries, better known as LFP, the stuff Tesla and Ford are using to make EVs cheaper.A123 had a brief shot at becoming a supplier to Detroit automakers back in 2009, when General Motors and Chrysler were pledging to electrify cars in return for a government bailout. The company went public that year on the back of a supply deal with Chrysler and a $249 million grant from the Obama administration, which was pumping up the economy to prevent the Great Recession from becoming a depression. But range was meager, gas prices were falling, and American car buyers were rekindling their romance with gas guzzlers. After opening a factory before sales materialized, A123 went bankrupt. Chinese parts maker Wanxiang Group scooped up its remains in 2013.