A123 Systems, the maker of Lithium-ion batteries, will supply power packs for the Fisker Karma, a rechargeable luxury car set to launch later this year.
A123 has also committed to invest $23 million as part of an ongoing funding round for Fisker Automotive, the company developing the Karma.
The Boston-based battery developer steps in as a second choice for Los Angeles-based Fisker, which until Wednesday had been in talks with EnerDel to develop its automobiles’ batteries.
Talks between Fisker and EnerDel broke off, according to Fisker founder and Chief Executive Henrik Fisker, because EnerDel was unable to meet the automaker’s production schedule for its Karma model, reports Reuters via PeHUB.
For A123 this is a market-creating deal, as it will gives it the annual ability to supply batteries for about 24,000 plug-in hybrids. Last December the company was also awarded a contract to supply battery systems for China’s SAIC Motor Form.
Last year Fisker scored a $528 million federal loan guarantee to help fund its expansion plans. As a condition of receiving that money, Fisker has been raising additional equity from investors.