Electric Vehicle Battery Maker Bailed Out By Obama Files For Bankruptcy

fisker karmaWeak demand for the Fisker Karma hurt A123.

Photo: Fisker

Electric vehicle battery maker A123 and its US subsidiaries filed for Chapter 11 bankruptcy protection this morning, it announced. It will sell its automotive business assets to Johnson Controls, another battery producer.After Mitt Romney’s attack on Tesla and other clean energy investments as “losers” in the last debate, expect this news to come up in round two, tonight.

A123 benefitted from a $249 million grant from the U.S. government in 2009. In 2010, President Obama hailed the company as a success.

The move is not surprising, after A123 announced in an SEC filing last week it would be unable to pay the interest due on $143.75 million of outstanding convertible debt.

Weak demand for the cars whose battery it produces, including the Fisker Karma, hurt A123, which had expected to created 38,000 jobs in the United States, according to Reuters.

SEE MORE: Taxes and Credits Will Never Make Electric Vehicles Profitable, But Something Else Might

Business Insider Emails & Alerts

Site highlights each day to your inbox.

Follow Business Insider Australia on Facebook, Twitter, LinkedIn, and Instagram.