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A123 pays out $55m to retrieve faulty battery packs

28 Mar 2012

Energy storage company A123 Systems has launched a $55m replacement programme for defective battery packs and modules, produced at the company’s manufacturing facility in Michigan.

The battery packs and modules are thought to contain faulty prismatic cells and the company has already begun building replacement modules which it expects to begin shipping to impacted customers this week.

David Vieau, CEO of A123 Systems, said, ‘Recently, A123 has discovered that some prismatic cells made in our Livonia facility may contain a defect which can result in premature failure of a battery pack or module that includes a defective cell.

‘We have isolated the root cause of the defective cells and we are confident that we have pinpointed the source of the defect and corrected it. As a result of engineering analysis and testing, we believe this is not a safety issue, and we have determined the root cause and have taken corrective actions.

‘We are working to get replacement packs and modules to impacted customers as quickly as possible. It is important to note that this defect has been discovered only in some prismatic cells manufactured at our Livonia facility. Prismatic cells produced at another A123 facility are not impacted. Further, the cylindrical cells we make at our facilities in China for a number of other transportation programmes, as well as the majority of our grid energy storage systems and commercial applications, are also not affected by this defect.’

Vieau continued, ‘In parallel with this field campaign, as we have discussed previously, we continue to implement actions that we believe will improve operations and minimise the possibility of quality issues going forward.

‘This includes hiring a chief operating officer, Ed Kopkowski, who has more than 25 years of global management and operational leadership in improving quality and reducing costs. A123 has produced hundreds of thousands of high-quality prismatic cells at another facility, so while the initial rapid ramp up of our Michigan operations to satisfy customer demand has resulted in near-term operational challenges, we are confident in our ability to overcome these issues.

‘We are devoting our full resources to fixing this situation and moving forward to continue delivering high-quality products to our customers.’

Copyright © 2012 NewNet

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