WATERTOWN, MASS. (Nov. 29, 12:15 p.m. ET) — Reduced lithium-ion battery orders caused A123 Systems LLC to lay off about 125 employees at its Livonia and Romulus, Mich., plants this month.
Watertown-based A123 fell victim to lower demand after Irvine, Calif.-based Fisker Automotive ran into production delays for its Karma plug-in hybrid sports car, said Jason Forcier, vice president and general manager of automotive solutions at A123.
Fisker projected delivery of 7,000 cars this year, but faulty wire harnesses delayed production. Fisker reduced its deliveries to 1,500 vehicles for 2011, Chairman Ray Lane told Crain's sister publication Automotive News this month.
Fisker expects to deliver 15,000 cars in 2012, Lane said.
A123 is the sole supplier of lithium-ion batteries to Fisker.
Forcier said that the layoffs are temporary and that the workers should be hired back within four to six months.
“We're basically aligning our workforce with that reduction in orders from Fisker,” he said. “We had to take some action to get our costs in line, but we believe it to be temporary, and we'll bring those people back as Fisker works through some inventory.”
This month after the Fisker announcement, A123 reduced year-end revenue projections to $165 million to $180 million from $210 million to $225 million.
A123 still employs 600 at its two plants and engineering center in Ann Arbor.
The supplier supports 21 current or pending vehicle programs at its Michigan plants, including the BMW 5-series ActiveHybrid and the upcoming Chevrolet Spark Electric.
Lithium-ion batteries are plastics-intensive products, with typically with injection molded cases and sheets of treated thermoplastic at the core.