Robert Bryce: The Next ‘Next Solyndra’

Another electric-car disaster looms.

Get ready for the next Solyndra. Sure, you’ve heard those words before. Over the past few months, several companies that had federal backing — Beacon Power, Range Fuels, and Ener1 — all failed. And another one is almost surely on the way. Here’s my prediction: Within 18 months, A123 Systems, the battery maker that got a $249 million grant from the Department of Energy, will be bankrupt.

My prediction doesn’t have anything to do with the explosion that occurred on Wednesday at a GM laboratory near Detroit, sending one worker to the hospital. The explosion occurred while the worker was testing a battery made by A123. That news came on the heels of the announcement last month that A123 would have to spend $55 million to replace defective battery packs it sold to Fisker Automotive, the car company that is using a U.S. government loan to make high-performance $100,000 vehicles in Finland. But predicting A123’s failure doesn’t depend on the latest news, or require any special analytical skills or inside market knowledge. It requires only a quick look at the company’s financials.

More on that in a moment. First, though, the broader and more essential point to be made — yet again — is that the Obama administration made a huge mistake in backing the electric-vehicle industry. The administration has handed out $2.4 billion in grants to the electric-vehicle sector, as well as nearly $2.6 billion in loans. And it did so despite the EV sector’s dismal history, which is a century of failure tailgating failure.

NRO

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3 responses to “Robert Bryce: The Next ‘Next Solyndra’

  1. The problem with this article is the perspective
    of the writer. Consider this:

    “Obama administration made a huge mistake in backing the electric-vehicle industry. The administration has handed out $2.4 billion in grants to the electric-vehicle sector, as well as nearly $2.6 billion in loans. And it did so despite the EV sector’s dismal history, which is a century of failure tailgating failure.”

    Payouts to cronies cannot be characterized as
    “a huge mistake.” The writer assumes it is about
    electric cars. Look behind the curtain, Dorothy.

  2. The “Chicago way”.

  3. I feel sorry for the personnel and engineering staff at A123. The Democrats lured them into a situation where they basically bit off more than they could chew. The result might be that it takes the whole company down when A123 actually had some viable products in the 18650 and 26650 lithium-ion cells.

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