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Discussion Starter · #1 ·
One of my fears has come to pass as A123 Files for Chapter 11 Protection this morning.
http://online.wsj.com/article/SB10000872396390443854204578060433271656440.html?mod=djemalertNEWS

Johnson Controls Inc. will buy the assets of A123 Systems Inc. (Not the liabilities)
http://www.jsonline.com/blogs/business/174380331.html
 

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RE: A123 Systems Files for Bankruptcy

Just in time for the debate. :/ So what does this mean for all those batteries that were supposed to be replaced? How many have been replaced so far.
 

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Discussion Starter · #3 ·
RE: A123 Systems Files for Bankruptcy

doug said:
Just in time for the debate. :/ So what does this mean for all those batteries that were supposed to be replaced? How many have been replaced so far.
Unfortunately, A123 will no longer be responsible, so we have to bank on Fisker being financially successful enough to absorb the costs of the replacement batteries.
 

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RE: A123 Systems Files for Bankruptcy

Chicago said:
doug said:
Just in time for the debate. :/ So what does this mean for all those batteries that were supposed to be replaced? How many have been replaced so far.
Unfortunately, A123 will no longer be responsible, so we have to bank on Fisker being financially successful enough to absorb the costs of the replacement batteries.
I disagree. Johnson Controls (or whoever buys A123 out of bankruptcy) will make good on A123's obligation to replace the Fisker batteries. They are buying A123 to enhance their position as a supplier of advanced Li batteries, and won't want to desert one of the key customers they are inheriting.

A123's auto business fits with Johnson Controls' "long-term growth strategies and overall commitment to the development of the advanced battery industry," Johnson Controls Power Solutions President Alex Molinaroli said in a statement.

Johnson Controls, based in Milwaukee, is one of the largest auto-parts makers in the world and is the single largest maker of standard automotive batteries. It has been expanding its operations in advanced lithium-ion batteries and has built a plant in Holland, Mich. It counts Daimler AG and BMW AG as customers.
 

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RE: A123 Systems Files for Bankruptcy

I have an email from Fisker indicating my VIN has a battery that is to be replaced and that it would be accomplished by the end of the third quarter of this year. When I spoke to the service manager at the dealer the other day, he told me Fisker was rethinking their need to replace batteries that had not had a problem. I emailed the guy at Fisker telling him I would hold Fisker to his promise, and that I wanted the date by which Fisker would replace my battery in a return email no later than Oct. 19. Now I understand why they were rethinking the replacement.
 

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A123 is Bankrupt!

A123 systems, the company that makes the batteries for Fisker Automotive, filed for Ch.11 bankruptcy protection today.....this is the first time I'm now NERVOUS about owning my Fisker. If parts are not available for the car, how much value can it possibly retain into the future? I understand 11 is reorganization and not liquidation, but it's very concerning to say the least.
 

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RE: A123 is Bankrupt!

txam99 said:
A123 systems, the company that makes the batteries for Fisker Automotive, filed for Ch.11 bankruptcy protection today.....this is the first time I'm now NERVOUS about owning my Fisker. If parts are not available for the car, how much value can it possibly retain into the future? I understand 11 is reorganization and not liquidation, but it's very concerning to say the least.
Assuming the offer from Johnson Controls is accepted by the bankruptcy court, I think we will be better off as owners. Johnson Controls is already a supplier of Li batteries to Mercedes and BMW, and are one of the largest auto parts suppliers in the world. So Fisker will be getting their batteries from an established supplier rather than a cash-strapped startup.
 

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Discussion Starter · #8 ·
RE: A123 Systems Files for Bankruptcy

dennis said:
Chicago said:
doug said:
Just in time for the debate. :/ So what does this mean for all those batteries that were supposed to be replaced? How many have been replaced so far.
Unfortunately, A123 will no longer be responsible, so we have to bank on Fisker being financially successful enough to absorb the costs of the replacement batteries.
I disagree. Johnson Controls (or whoever buys A123 out of bankruptcy) will make good on A123's obligation to replace the Fisker batteries. They are buying A123 to enhance their position as a supplier of advanced Li batteries, and won't want to desert one of the key customers they are inheriting.

A123's auto business fits with Johnson Controls' "long-term growth strategies and overall commitment to the development of the advanced battery industry," Johnson Controls Power Solutions President Alex Molinaroli said in a statement.

Johnson Controls, based in Milwaukee, is one of the largest auto-parts makers in the world and is the single largest maker of standard automotive batteries. It has been expanding its operations in advanced lithium-ion batteries and has built a plant in Holland, Mich. It counts Daimler AG and BMW AG as customers.
I hope you are correct.
 

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A123 Systems Files for Bankruptcy

i just got my batteries replaced before delivery one month ago
 

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RE: A123 is Bankrupt!

dennis said:
txam99 said:
A123 systems, the company that makes the batteries for Fisker Automotive, filed for Ch.11 bankruptcy protection today.....this is the first time I'm now NERVOUS about owning my Fisker. If parts are not available for the car, how much value can it possibly retain into the future? I understand 11 is reorganization and not liquidation, but it's very concerning to say the least.
Assuming the offer from Johnson Controls is accepted by the bankruptcy court, I think we will be better off as owners. Johnson Controls is already a supplier of Li batteries to Mercedes and BMW, and are one of the largest auto parts suppliers in the world. So Fisker will be getting their batteries from an established supplier rather than a cash-strapped startup.
called my dealer and i'm told they have a second source. also under Johnson we should hopefully have more established QA practice
 

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RE: A123 Systems Files for Bankruptcy

I never got a notice from Fisker nor do I know if my battery is effected. I know my warranty was extended to 6 years. So i would assume if my battery is not replaced and it fails during the warranty period and Johnston controls owns A123 and assuming Fisker does not go belly up, what are the chances I get a new battery?


Just wondering? I'm going to post this question to my dealer.
 

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RE: A123 Systems Files for Bankruptcy

Nin ja said:
I never got a notice from Fisker nor do I know if my battery is effected. I know my warranty was extended to 6 years. So i would assume if my battery is not replaced and it fails during the warranty period and Johnston controls owns A123 and assuming Fisker does not go belly up, what are the chances I get a new battery?


Just wondering? I'm going to post this question to my dealer.
Bypass the dealer and contact Fisker's customer service directly on this one. Only Fisker has the list of affected VINs so the dealer would have to contact them to get the information. I would be better to cut out the middle-person and go right to the source.
 

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RE: A123 is Bankrupt!

This thread should be merged with the other one.

Has Fisker made any statements today to reassure its customers?
 

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RE: A123 Systems Files for Bankruptcy

dennis said:
Johnson Controls (or whoever buys A123 out of bankruptcy) will make good on A123's obligation to replace the Fisker batteries.
I'm not so sure. They didn't buy the company outright. The bought it after bankruptcy. The whole point of bankruptcy is to be released from some of your liabilities.

I agree that it would be a good gesture on JCI's part to make good on the replacement batteries, but I wouldn't count on it.
 

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RE: A123 Systems Files for Bankruptcy

Fabulist said:
Nin ja said:
I never got a notice from Fisker nor do I know if my battery is effected. I know my warranty was extended to 6 years. So i would assume if my battery is not replaced and it fails during the warranty period and Johnston controls owns A123 and assuming Fisker does not go belly up, what are the chances I get a new battery?


Just wondering? I'm going to post this question to my dealer.
Bypass the dealer and contact Fisker's customer service directly on this one. Only Fisker has the list of affected VINs so the dealer would have to contact them to get the information. I would be better to cut out the middle-person and go right to the source.

anyone at fisker in particular? i sent a note to my dealer and you are right, canned answer.
 

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RE: A123 Systems Files for Bankruptcy

doug said:
dennis said:
Johnson Controls (or whoever buys A123 out of bankruptcy) will make good on A123's obligation to replace the Fisker batteries.
I'm not so sure. They didn't buy the company outright. The bought it after bankruptcy. The whole point of bankruptcy is to be released from some of your liabilities.

I agree that it would be a good gesture on JCI's part to make good on the replacement batteries, but I wouldn't count on it.
Johnson's offer is just for the auto portion of A123's business, not the grid storage and other businesses. I just don't see them abandoning an existing customer in a market they are investing in. It would not make good business sense.

Full disclosure: @doug is a moderator on Tesla Motors Club and AFAIK does not own a Karma. I am an investor in Fisker and Tesla and have owned my Karma since January.
 

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Discussion Starter · #17 ·
RE: A123 Systems Files for Bankruptcy

dennis said:
doug said:
dennis said:
Johnson Controls (or whoever buys A123 out of bankruptcy) will make good on A123's obligation to replace the Fisker batteries.
I'm not so sure. They didn't buy the company outright. The bought it after bankruptcy. The whole point of bankruptcy is to be released from some of your liabilities.

I agree that it would be a good gesture on JCI's part to make good on the replacement batteries, but I wouldn't count on it.
Johnson's offer is just for the auto portion of A123's business, not the grid storage and other businesses. I just don't see them abandoning an existing customer in a market they are investing in. It would not make good business sense.

Full disclosure: @doug is a moderator on Tesla Motors Club and AFAIK does not own a Karma. I am an investor in Fisker.
I don't see how this would be abandoning an existing customer in the market, JC can supply Fisker with all the batteries they want without having to replace defective batteries produced before bankruptcy.
 

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RE: A123 Systems Files for Bankruptcy

Chicago said:
dennis said:
doug said:
dennis said:
Johnson Controls (or whoever buys A123 out of bankruptcy) will make good on A123's obligation to replace the Fisker batteries.
I'm not so sure. They didn't buy the company outright. The bought it after bankruptcy. The whole point of bankruptcy is to be released from some of your liabilities.

I agree that it would be a good gesture on JCI's part to make good on the replacement batteries, but I wouldn't count on it.
Johnson's offer is just for the auto portion of A123's business, not the grid storage and other businesses. I just don't see them abandoning an existing customer in a market they are investing in. It would not make good business sense.

Full disclosure: @doug is a moderator on Tesla Motors Club and AFAIK does not own a Karma. I am an investor in Fisker and Tesla and have owned my Karma since January.
I don't see how this would be abandoning an existing customer in the market, JC can supply Fisker with all the batteries they want without having to replace defective batteries produced before bankruptcy.
In that scenario, why would Fisker continue to buy batteries from Johnson if they just reneged on the requirement to replace the existing batteries? Also, since A123 fully reserved the $55 million in charges for the battery replacement Johnson can use those tax losses to offset profits in other businesses.
 

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Discussion Starter · #19 ·
RE: A123 Systems Files for Bankruptcy

dennis said:
Chicago said:
dennis said:
doug said:
dennis said:
Johnson Controls (or whoever buys A123 out of bankruptcy) will make good on A123's obligation to replace the Fisker batteries.
I'm not so sure. They didn't buy the company outright. The bought it after bankruptcy. The whole point of bankruptcy is to be released from some of your liabilities.

I agree that it would be a good gesture on JCI's part to make good on the replacement batteries, but I wouldn't count on it.
Johnson's offer is just for the auto portion of A123's business, not the grid storage and other businesses. I just don't see them abandoning an existing customer in a market they are investing in. It would not make good business sense.

Full disclosure: @doug is a moderator on Tesla Motors Club and AFAIK does not own a Karma. I am an investor in Fiskera and Tesla and have owned my Karma since January.
I don't see how this would be abandoning an existing customer in the market, JC can supply Fisker with all the batteries they want without having to replace defective batteries produced before bankruptcy.
In that scenario, why would Fisker continue to buy batteries from Johnson if they just reneged on the requirement to replace the existing batteries? Also, since A123 fully reserved the $55 million in charges for the battery replacement Johnson can use those tax losses to offset profits in other businesses.
I would expect Fisker will go with the supplier who produces the battery with the best price/quality combination. A new supplier would have to tool up to supply the Karma battery which could be a huge capitol expense. My expectation is the path of least resistance would clearly be to stick with the existing supplier due to tooling costs, whether they replace pre-bankruptcy A123 batteries or not. Anyway, I certainly hope JC will replace the existing batteries. I want Fisker to not only to survive but thrive. It is an awesome ride!
 

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RE: A123 Systems Files for Bankruptcy

Chicago said:
dennis said:
Chicago said:
dennis said:
doug said:
I'm not so sure. They didn't buy the company outright. The bought it after bankruptcy. The whole point of bankruptcy is to be released from some of your liabilities.

I agree that it would be a good gesture on JCI's part to make good on the replacement batteries, but I wouldn't count on it.
Johnson's offer is just for the auto portion of A123's business, not the grid storage and other businesses. I just don't see them abandoning an existing customer in a market they are investing in. It would not make good business sense.

Full disclosure: @doug is a moderator on Tesla Motors Club and AFAIK does not own a Karma. I am an investor in Fiskera and Tesla and have owned my Karma since January.
I don't see how this would be abandoning an existing customer in the market, JC can supply Fisker with all the batteries they want without having to replace defective batteries produced before bankruptcy.
In that scenario, why would Fisker continue to buy batteries from Johnson if they just reneged on the requirement to replace the existing batteries? Also, since A123 fully reserved the $55 million in charges for the battery replacement Johnson can use those tax losses to offset profits in other businesses.
I would expect Fisker will go with the supplier who produces the battery with the best price/quality combination. A new supplier would have to tool up to supply the Karma battery which could be a huge capitol expense. My expectation is the path of least resistance would clearly be to stick with the existing supplier due to tooling costs, whether they replace pre-bankruptcy A123 batteries or not. Anyway, I certainly hope JC will replace the existing batteries. I want Fisker to not only to survive but thrive. It is an awesome ride!
I have been involved in 7 bankruptcies.Although I do not have any of the filing details I suspect Fisker's claim against A123 was unsecured. Unsecured claims are washed in a bankruptcy which the primary reason A123 filled chapter 11.
At the end of the day... Someone has to eat the cost of replacing the batteries. Fisker has a contractual obligation to its customers and must replace the defective batteries. Either Fisker gets the batteries for free from JC or must buy the batteries from JC or a third party. JC has no obligation to Fisker's customers other than bad PR considerations.
A smart JC Negotiator will use Fisker's poor cash position to lock up an exclusive contract for all of Fisker's present and future products. In return JC will supply replacement batteries to Fisker's existing fleet at cost or at some negotiated sharing sharing arrangement
 
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